Possibly the real reason why Tesco are ending the direct debit facility into their savings accounts

eskbanker · 13 April 2018 at 3:01PM

YorkshireBoy wrote: »

I do wonder though, if the DDs had been for, say, £10 each, and customers didn't send the funds back the same day, but once a year, whether they would have made the move they have?

fun4everyone wrote: »

I completely agree and people doing £1 dd's were being ignorant blockheads. If that hadn't been going on it might have lasted longer.

That said, if it is possible to take the p iss then humans always will and imo it would have been pulled eventually anyway.

We're all just speculating but personally I'm unconvinced that their move was (exclusively) to do with the value of the DDs and could equally have been down to the volume, i.e. people with DDs set to pull from multiple different current accounts, which is obviously an artificial process exploiting a loophole, regardless of whether they were £1, £10, £18.37 or £100, rather than the pattern of a genuine saver.

Having said that, it would have been straightforward for them to have closed off either such loophole (value or volume) without withdrawing the entire facility so I still believe there are other drivers for their actions....

eskbanker · 13 April 2018 at 3:06PM

aj23 wrote: »

But you're instructing your bank to authorise it, it's your bank who will take the money and send it to who it is going to. If something goes wrong, it's not always you who would be responsible.

In December, Telefonica didn't take my direct debit. They gave me a week to pay or face late payment charges. Little difficult as I was in the South China Sea with weak GPS. I didn't see the email straight away, and managed to get a strong enough connection to the day before it was due to pay by credit card. They said it was the bank, but when I got home I went into branch (they have their uses) and they said that it wasn't taken then returned, so it wasn't the bank's fault, it was Telefonica. If it was the bank, it would have been taken then returned as the bank would have stopped it. The bank confirmed that no attempt had been made to take it.

Yes, I understand the significance and importance of the direct debit guarantee scheme for 'real' DDs but am just observing that it's not relevant to the scenario of using DDs to transfer money between one's own personal current and savings accounts.

eskbanker · 13 April 2018 at 3:30PM

fun4everyone wrote: »

This lot here

https://fastpayltd.co.uk/direct-debit-solutions/pricing/

Are charging 10-50p per direct debit.

So Mr Partington who has 12 monthly dd's of £1 to satisfy all his rewards hunger is costing tesco between £1.20 to £6 per month. No doubt he snap transfers the £1s all back out again immediately so the whole thing is completely worthless to Tesco.

How many people were doing this? Since it was all over this website it must have been costing a fortune imo.

If you're seriously trying to suggest that the cost to Tesco Bank of internally processing direct debit payments bears any resemblance to the prices charged by a small independent provider to other small businesses then I think you need to learn more about the economies of scale!

However, the underlying point remains valid, i.e. that there will be some sort of cost involved....

EachPenny · 13 April 2018 at 4:00PM

YorkshireBoy wrote: »

But they could have very easily sorted the 3 Ps (paper, printing, and postage) issue by serving 60 days notice that they were moving to online only*, rather than encouraging their customers to close their old (now bonus exempt) IS and IASA accounts by removing the DD facility.

It doesn't help that they seem to think it necessary to include a FSCS Information Sheet with every statement they post out, and that each account's statement has to come in a separate envelope.

2010 · 13 April 2018 at 4:12PM

I thought Tesco had given the reason when it first gave notice last Oct and again this March and yet again two days ago by letter and yesterday by email.

veryintrigued · 13 April 2018 at 4:20PM

************************what???*********************

**************tescos are ending their dd facility?*********

why has this not been communicated or discussed on here?

[Deleted User] · 13 April 2018 at 4:47PM

EachPenny wrote: »

It doesn't help that they seem to think it necessary to include a FSCS Information Sheet with every statement they post out, and that each account's statement has to come in a separate envelope.

I have always assumed that the FSCS info sheet with every statement, account opening confirmation letter etc etc is a regulatory requirement and not something which Tesco chooses to do. The statement dates for separate accounts will not usually coincide, so the separate mailings may not be possible to avoid.

mollycat · 13 April 2018 at 5:04PM

veryintrigued wrote: »

************************what???*********************

**************tescos are ending their dd facility?*********

why has this not been communicated or discussed on here?

I've got more bad news for you.....

John Lennon's dead! :eek:

Westie983 · 13 April 2018 at 5:21PM

2010 wrote: »

I thought Tesco had given the reason when it first gave notice last Oct and again this March and yet again two days ago by letter and yesterday by email.

Dont forget the notice you see when you log into internet banking too....

Westie983

Possibly the real reason why Tesco are ending the direct debit facility into their savings accounts

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