Now may be a good time to cancel your direct debits...

dub45

Very shortly UPC will do away their non direct debit fee of 3.75 per bill so this may be a good time to cancel your dd with them however even if you are not a UPC customer the imminent SEPA dd rules should cause everyone to think about cancelling any dd they can.

1. Unfortunately under the new dd sepa rules it seems that the obligation on a company not to debit a disputed amount is gone! Now this "obligation" may have been more honored in the breach than in the observance but at least it gave the bill payer some leverage with a company. Now a company can hit your account with any amount they like. There is no incentive to get the bill right (I will come to stopping a dd shortly:))

2. Up to now billing information was sent to the banks 3 days in advance of the due date however SEPA allows banks to forward the information much sooner. For example UPC are forwarding the information 7 days ahead of the due date and there seems little doubt that other companies will follow. The earlier a company sends the dd info to the bank the harder it is for a bill payer to have a wrong bill corrected. As there is less time between the bill payer receiving the bill and the dispatch of the dd information to the banks.

Now some people may already know that there is provision to stop a dd hitting an account or even reversing a direct debit:

"You are entitled to request a refund of any variable direct debit which exceeded the amount which you could reasonably have expected, subject to you so requesting your bank within a period of 8 weeks from the date of debiting such direct debit to your account; your bank is entitled to ask you to provide factual elements relating to your request for a refund

You can request your bank to refuse a direct debit payment on your account up to close of business the day before the direct debit is due to be paid from your account"

http://www.ipso.ie/section/section/YourRightsasaPayer

There rights were introduced apparently as a result of Payment Services Regulation 2009 and Regulation 260/2012.

However it has emerged over the past couple of weeks that UPC are charging customers hefty administration fees for exercising these rights. They have confirmed that they can charge a customer who reverses a dd 50 euros. Again it is only a matter of time before other companies start doing this.

It seems incredible that a customer can be charged hefty administration fees for exercising their legal and scheme rights particularly in a case where the company may have been totally wrong with their billing and about to wipe out the customers account. It is difficult to believe that this was the intention of those who drew up these regulations.

I have asked IPSO about this behaviour and of course they don't care claiming that it is not a matter for them.

The dd scheme provides many many cost saving advantages for companies and the bill payer has bother, risk and administration fees thrust upon him/her in gratitude. And now as another poster pointed out there is effectively financial intimidation not to exercise your dd scheme and legal rights.

Cancel as many as you can get out of - this nonsense should not be tolerated

mickdw

dub45 wrote: »

Very shortly UPC will do away their non direct debit fee of 3.75 per bill so this may be a good time to cancel your dd with them however even if you are not a UPC customer the imminent SEPA dd rules should cause everyone to think about cancelling any dd they can.

1. Unfortunately under the new dd sepa rules it seems that the obligation on a company not to debit a disputed amount is gone! Now this "obligation" may have been more honored in the breach than in the observance but at least it gave the bill payer some leverage with a company. Now a company can hit your account with any amount they like. There is no incentive to get the bill right (I will come to stopping a dd shortly:)


2. Up to now billing information was sent to the banks 3 days in advance of the due date however SEPA allows banks to forward the information much sooner. For example UPC are forwarding the information 7 days ahead of the due date and there seems little doubt that other companies will follow. The earlier a company sends the dd info to the bank the harder it is for a bill payer to have a wrong bill corrected. As there is less time between the bill payer receiving the bill and the dispatch of the dd information to the banks.

Now some people may already know that there is provision to stop a dd hitting an account or even reversing a direct debit:

You are entitled to request a refund of any variable direct debit which exceeded the amount which you could reasonably have expected, subject to you so requesting your bank within a period of 8 weeks from the date of debiting such direct debit to your account; your bank is entitled to ask you to provide factual elements relating to your request for a refund

You can request your bank to refuse a direct debit payment on your account up to close of business the day before the direct debit is due to be paid from your account

There rights were introduced apparently as a result of Payment Services Regulation 2009 and Regulation 260/2012.

However it has emerged over the past couple of weeks that UPC are charging customers hefty administration fees for exercising these rights. They have confirmed that they can charge a customer who reverses a dd 50 euros. Again it is only a matter of time before other companies start doing this.

It seems incredible that a customer can be charged hefty administration fees for exercising their legal and scheme rights particularly in a case where the company may have been totally wrong with their billing and about to wipe out the customers account.

I have asked IPSO about this behaviour and of course they don't care claiming that it is not a matter for them.

The dd scheme provides many many advantages for companies and the bill payer has bother,isk and administration fees thrust upon him/her in gratitude.

Cancel as many as you can get out of - this nonsense should not be tolerated

Very interesting. I was not aware of any of that. Might be a bad move for businesses at the end of the day if people become wary of signing up for dd.
I will certainly be attempting to make alternative arrangements although I only have phone and broadband dd.

Kristopherus

Would the National Consumer Agency have any influence over this possible nonsense?

dub45

The problem is getting any of these agencies interested at the right level. They usually only respond to a public outcry which of course means the likes of the Joe Duffy show or some newspaper taking an interest. How no newspaper has ever taken the dd scheme apart long before now baffles me anyway.

Its extraordinary that exercising your dd scheme or legal rights just provides another revenue opportunity for business to avail of.

wheresmybeaver

The changes to DD under SEPA are interesting.

On the positive, you can now get a "no questions asked" refund on any DD that has hit your account in the last 8 weeks. There are forms for this already on most of the Irish banks websites. And you can still dispute a DD for up to about another year after that. This applies to all DDs regardless of when you signed the DD mandate with the company (ie 1998 or 2014). Trouble is, some companies are likely to introduce "admin fees" should you avail of this refund where none is warranted. If you have a legit reason to claim the refund and they still charge an admin fee then I'm sure there will have to be a test claim or something in one of the courts to correct this. Or a phone call to Joe. We'll see.

SEPA DD also allows you to have white lists or black lists of DD companies, and to set rules. eg you can tell your bank that your account should only have a single DD per month, from UPC, and it should be less than €50. If anyone else tries to debit your account it fails automatically. If UPC tries to debit your account €55, or more than once in a calendar month, it fails. And to penalise them their bank will usually charge about €3.50 for each failure.

Under the old DD scheme a company could submit their DD instructions to their bank as late as the day before the DD itself. This was good because a customer could tell them at a fairly late stage to cancel a particular DD because they had no money in their account. The company would usually then push that particular DD back a few days, and avoid penalty fees both for themselves and for their customer (customer penalties can be up to €12). Under SEPA now though the company has to submit 3 days in advance, or even 6 days if it's the first time they have debited this particular customer. So there's likely to be a lot more failed DD collections and a hell of an increase in penalty charges for both the DD collector and the customer.

Which is exactly why we decided not to become DD originators when we recently got this info from our bank ;-)