I really do wonder if there should be a stupidity tax some times...
OK, when people pay us, just like every other utility, we need a payment with the right sort-code, account number and reference. Bog standard stuff - same for gas, electric, water, telephone, tax, vat, everything. The beneficiary reference is part of the BACS (Bankers Automated Clearing System) that has been around a long time and is an 18 character string that you need to quote on the payment for the beneficiary (person getting the money) to be able to work out what it is for.
Yes, paying money to a mate - the reference does not matter - but paying your VAT bill? They need to know your VAT number as a reference...
We have a simple system - pay us with your account number, e.g. A12345A on the reference. We automatically allocate it to the right account. No human intervention required. When you have thousands of people paying you - you need a simple automated system.
Now, some people pay with the wrong reference. It happens. People make mistakes. How they pay anyone else right, I don't know. They just make up crap. Sometimes we'll get a payment from "CURRENT ACCOUNT" with reference "BROADBAND" for £19.40 - WTF are we meant to do with that?
And then people post a remittance advice, like that helps anyone...
So, we try to be nice. If we can work out manually who it is then we send a nice letter asking them to put the right reference. Then next time a less nice one pointing out it is actually part of the terms to put the right reference. Finally one explaining that if they really won't put the right reference then there is a £5+VAT admin fee for us manually allocating it. Of course if we can't allocate the payment someone just gets a £40 late payment penalty instead as we did not know they had paid - we credit that and start the nice letters when they eventually complain.
But what the hell do you do with special people that insist on paying you with no reference over and over and over again? They then get an invoice for £6 (£5+VAT) for an admin fee for paying without a reference, and pay the £6, by BACS, without the right reference. Wha?!?!??
This is, for amusement, a government department. But it sounds like we have a hands off money making machine. Every time they pay £6 we can charge them £6 admin fee for paying without the right reference. Rinse, repeat.
Never once had a sensible explanation from anyone that does this.
P.S. We do try and avoid this by including the £6 in the next invoice, so they don't pay it separately. But quarterly billed customers get it separately as the system does not like any debt un-invoiced for more than a month, which seems fair enough to me.