Direct Debits

I am sure it is not just me that gets annoyed. I used to refuse to do any DDs personally, but they are not so bad when you understand the rules.

What is really pissing me off is some of the suppliers to A&A, big companies, that simply do not follow the DD rules. It drives me mad. The basic rules really are very simple: give the agreed advance notice of collection stating amount and date, and collect that amount on (or immediately after) that date and not before. Basically. They are allowed to collect up to 3 working days late, but not early. They can give a "recurring" notice that an amount is collected every month, etc, or a schedule of advance collections. But whatever, they have to give advance notice of collection one way or another.

When A&A collect by DD, we put a lot of effort in to meet the rules, including being very careful of the wording and layout of the advance notice we send, and ensuring we always send one with the agreed notice period, etc. We log what notice we send, and delivery reports in case of any query later. We have systems to allow any queried DD to be cancelled up to 2 days before collection and to immediately and automatcally refund any DD that we find afterwards was more than it should have been (e.g. if a credit note was issued later). It works well. We get almost no disputes and they are mistakes when they happen.

But suppliers charging by DD is really annoying. Almost none of them get it right.

  • We have one supplier who don't mention DD on the bill, but still expect to collect tens of thousands by DD without saying what date.
  • We have one supplier that thinks it is fine to collect thousands of pounds the day before the notice said they would.
  • We have one supplier that send two bills each month for different services, one states DD collection and one does not - but they always collect whatever the balance is on their DD run later in the month regardless of what the notice actually said, and get upset if we pay the one that did not have a DD notice by BACS credit to them (as detailed on the back of that invoice as a valid and expected way to pay).

I am getting so fed up that we are now, as a matter of policy, reclaiming all incorrect DDs. This is the only way to get these people to follow the rules, and is entirely correct as per the rules. You can bounce a DD on the day (or maybe the day after), or you can later reclaim a DD. In either case you need a reason, such as disputing the notice given, etc. There are a list of valid reasons. The bank have to do an immediate refund, and Barclays seem to do that correctly. You don't have to cancel the instruction when you do that. You still owe the supplier what is validly due.

I just want suppliers to follow the simple DD rules, or failing that, if it is too hard for them, let me pay by BACS credit. We have a good system in place so we never pay anyone late and send BACS payments reliably with the right reference. Insisting on DD collection and then getting it wrong is just daft, as well as creating a huge potential liability for claw backs if they do it to everyone.



  1. What annoys me no end is that NatWest reliably make clawing back money under the Direct Debit guarantee nearly impossible. You have to really press them in order to get them to uphold the Direct Debit rules :(

    1. Barclays are OK if you go in to the branch and find someone with a clue, but that is hassle. I have taken to writing to the branch asking for the reclaim. Takes an extra day, but is easy to do when you have a post room and postal collection at the office. At first they were not keen on letters for some reason but I got cross and they now just do what I say. Simples.

  2. To beat this absurdity, my mother had a company *instruct* her to go to the branch and reverse a Direct Debit payment that had gone through: "we took £250, but should in fact only have taken £215. To fix this, go to your branch and have the £250 reversed, then make a manual payment for the correct sum, £215. This will clear the balance and stop us sending threatening letters because we owe you £35." The obvious solution, refunding just the £35 overpayment, is apparently beyond their abilities, as is refunding the incorrect payment themselves as opposed to the customer reversing it, as is collecting the correct sum themselves - and they said themselves their current loan management software cannot distinguish between excess credit balances and overdue debts, with the result that both trigger big red-ink-laden collection letters.

    To cap the absurdity, the company in question is ... the bank itself. The first visit produced "ok, we'll just get the excess £35 refunded to you, sorry about that" from branch staff. A month later, a letter about the overpayment produced "oh yes, that's just a mistake, it's been sorted out, ignore that letter" from them on the phone. The month after that, branch staff finally got the DD payment reversal submitted and the correct payment made - after which, the call centre guy finally called back and said in somewhat mangled English "well, now you've cleared the arrears it's ok, we will remove the black mark from your credit record". That didn't go down well either.

    1. Just check that, if a record was added to a credit file, it has been removed entirely, and not simply marked as "satisfied"!

  3. I've just had an email from a well known Electricity company. At 19:18 on the 3/12 they sent me an email advising of a change to my direct debit amount for a collection on.... 3/12.



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