TV license extra charge

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letsbehonest
letsbehonest Posts: 1,098 Forumite
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in Praise, vent & warnings
I pay my TV license by DD every quarter, just received my payment plan letter which tells me that I am charged along with every one else a premium of £1.25 on every payment for the privilege of paying by DD. Payments all collected by computer so why the extra charge?
"Imagination is more Important than knowledge"

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  • Sharon87
    Sharon87 Posts: 4,011 Forumite
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    It's always been that way, not sure why the extra charge, maybe it's like an interest for not paying up front?

    I pay my annually and put aside money each month to pay it once a year. Cheapest way if you can afford it (always cheaper when you have money paradoxically)
  • London50
    London50 Posts: 1,850 Forumite
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    Pay quarterly
    Colour licences

    You’ll pay instalments of around £38.89 every three months.

    Unlike other payment methods, with quarterly payments you don’t pay for any of your licence upfront. As a result, each quarterly payment includes a £1.25 premium.
  • Moglex
    Moglex Posts: 1,581 Forumite
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    When you pay by quarterly instalments you are effectively paying (very high) interest.

    You don't pay interest if you pay monthly by DD, but that is because, once you get going, you are paying 50% in advance and 50% in arrears. It's a much better option.
  • neilmcl
    neilmcl Posts: 19,460 Forumite
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    letsbehonest wrote: »
    I pay my TV license by DD every quarter, just received my payment plan letter which tells me that I am charged along with every one else a premium of £1.25 on every payment for the privilege of paying by DD. Payments all collected by computer so why the extra charge?
    Because you've chosen to pay quarterly rather than upfront you're effectively taken a loan therefore the "premium" is effectively to cover the interest costs.
  • pogofish
    pogofish Posts: 10,852 Forumite
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    I'm struggling to see what this has to do with PVW...?

    If only MSE had A TV Forum to do this one again and again to peoples hearts content...?
  • Moglex
    Moglex Posts: 1,581 Forumite
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    pogofish wrote: »
    I'm struggling to see what this has to do with PVW...?

    Allow me to assist.

    The OP was Venting (the 'V' in 'PVW') that he had to pay extra. And Warning people of the extra cost.

    Hope that helps.
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