Can SEPA Direct debit be refused because it's not Irish?

Wcool

hi all,

I am with BOI and in the process of moving all my direct debits and account to N26.
One of my direct debits is Ark Life for mortgage insurance.

They refuse to accept my new German IBAN, stating it has to be an Irish bank.

Is this allowed?

I found this thread from 6 years ago:

Boards: can payee refuse SEPA Direct Debit and the same question was posed. But I don't see any definitive answer.

Is there a law I can use or governing body I can contact to complain?

Thanks!

JTMan

They cannot refuse a non-Irish IBAN.

The governing body is the CCPC.

Your first step is probably making a complaint to Ark Life.

Wcool

Well, I was just on the phone with them and the nice person from the call centre re-iterated that they couldn't accept a Non-irish SEPA account.

He started a complaints procedure for me but it might up to 40 days to get an answer.

I will write in to the CPCC too now.

To be honest I think it's shocking in 2020. I said, well I like to setup a standing order instead. That wasn't allowed either!? But they do accept postal orders or cheques.. Which century are we living?

The J Stands for Jay

Wcool wrote: »

Well, I was just on the phone with them and the nice person from the call centre re-iterated that they couldn't accept a Non-irish SEPA account.

He started a complaints procedure for me but it might up to 40 days to get an answer.

I will write in to the CPCC too now.

To be honest I think it's shocking in 2020. I said, well I like to setup a standing order instead. That wasn't allowed either!? But they do accept postal orders or cheques.. Which century are we living?

Ark Life are regulated by the Central Bank. Giving them a shout will be more effective than the CCPC.

Wcool

Well, I got an answer back, they are still refusing.

I have asked why (which terms and conditions) and fired off an email to the fspo with a generic question if this is forbidden.

Will see what the answers are. If not satisfying I will contact the Central bank.

If push comes to shove, I will cancel the whole insurance. I only have 18 months to go on my mortgage.

Jim2007

Wcool wrote: »

If push comes to shove, I will cancel the whole insurance. I only have 18 months to go on my mortgage.

Before you do that check out the conditions of your mortgage...

Wcool

That is a good point.
But i presume I can take insurance somewhere else.

Gee I wonder where the mortgage terms and conditions are 20 years have passed since last time...

The J Stands for Jay

Wcool wrote: »

Well, I got an answer back, they are still refusing.

I have asked why (which terms and conditions) and fired off an email to the fspo with a generic question if this is forbidden.

Will see what the answers are. If not satisfying I will contact the Central bank.

If push comes to shove, I will cancel the whole insurance. I only have 18 months to go on my mortgage.

Just go straight to the Central Bank. They sorted Laya out for me within a day. I hear that there's a massive backlog in the fspo.

Yggr of Asgard

Have you sent them the written Direct Debit instructions available here?

They are not required to accept instructions from you over phone for non-Irish bank accounts, but once you use their SEPA form they are.

So, before the regulator and in this case, it would be the Financial Services and Pensions Ombudsman will act you need to make sure you gave them written instructions and followed their internal complaints process. You can find info here.

Wcool

I did yes, and it contained the DE IBAN

I get some responses at the moment by email from Ark Life Complaints department that they can't process Non-Irish accounts but they don't tell me why (i.e. technical issue or by policy). I will query them on that.

I am now considering to propose to pay the remaining 18 months in full in 1 payment (not sure if they will accept)

If it is by policy that they don't accept I am going to the Central Bank anyway because I want Irish financial institutions to stop those shenanigans.

I do suspect it is by policy as my proposal to set up a standing order was denied as well

GerardKeating

Wcool wrote: »

I do suspect it is by policy as my proposal to set up a standing order was denied as well

More likley technical, a few companies are still using software from the pre-IBAN era, and have a utility program to convert the old style file into a modern SEPA xml file, and this is where your problem is.

It would almost certainly policy not to allow standing orders, since they would have to manually check it each month, whereas with a DD file, they get a file with confirmations/rejects etc.

Wcool

I know that, I work in IT. We all know some govs still use COBOL or Fortran and it wouldn't surprise me that they can only handle Irish sort codes + bank accounts.
i.e. when you give an IBAN they translate back to the old system...

But they DO allow cheques send in and postal orders!! So why not standing orders???

I believe Ark Life is winding down business, I believe they don't accept new insurance anymore (that's what they told me 3 years ago when I was checking if I could get a cheaper rate). So they don't want to change their IT system maybe.

But at least they should be more accommodating if that is the case and indeed they haven't said yet that it is technical.

TP_CM

Wcool wrote: »

If push comes to shove, I will cancel the whole insurance. I only have 18 months to go on my mortgage.

I wouldn't do that. A lot can happen in 18 months. Just change provider. Banks are probably the most expensive providers of insurance anyways.

Wcool

The good news is that my salary got transferred to my new N26 account.

The bad news is that AIB still requested the mortgage by Direct Debit from my BOI account despite changing the direct debit.

Did anyone else have this issue before I call them?

Wcool

Sorry for dragging up my own thread but I like to let people know how it went:

After 2 weeks Ark Life said they can actually process my new IBAN, no reason given but good result.

AIB took some time too, they claimed they couldn't read my IBAN on the form but a 2nd application solved it.

I cancelled my BOI account, which was surprising easy with an online form. I was 22 years a customer but happy to see them go. They never ever had a competitive service or product for me.