Unmet Direct Debit charges - not specified on sign up for dd

dub45

I am aware that some companies charge customers fees when Direct Debits are returned unpaid by the bank which are not specified to the customer when they are signing up for payment by dd.

For example the ESB charge €6 and UPC charge €11.

This amount is in addition to the charges which are imposed by the paying bank which are usually in the region of €12 and which can make missing a direct debit very costly indeed.

I consider that this practise of not advising customers of charges they may pay is highly dubious to put it kindly - there is no provision for it in the rules of the dd scheme and in view of the scale of the charge by UPC in particular it seems very likely that they are using it as a revenue generator in itself.

My informal information from people working in the bank is that up to 10% of dds are unmet (hardly surprising in the current climate) but a potentially significant source of income for the banks and companies who impose these charges.

So the point of my post is to find out from you if you have experienced having fees imposed which were not specified when you were signed up for dd and to list the companies involved and then to raise it with the Consumer Affairs People and given that the banks are overall responsible for the dd system possibly the Financial Regulator on the basis that a bill payment system should not be used as a revenue generator for large companies.

So if you have had this experience could you please name the Company and the amount you were charged.

foggy_lad

dub45 wrote: »

I am aware that some companies charge customers fees when Direct Debits are returned unpaid by the bank which are not specified to the customer when they are signing up for payment by dd.

For example the ESB charge €6 and UPC charge €11.50.

This amount is in addition to the charges which are imposed by the paying bank which are usually in the region of €12 and which can make missing a direct debit very costly indeed.

I consider that this practise of not advising customers of charges they may pay is highly dubious to put it kindly - there is no provision for it in the rules of the dd scheme and in view of the scale of the charge by UPC in particular it seems very likely that they are using it as a revenue generator in itself.

My informal information from people working in the bank is that up to 10% of dds are unmet (hardly surprising in the current climate) but a potentially significant source of income for the banks and companies who impose these charges.

So the point of my post is to find out from you if you have experienced having fees imposed which were not specified when you were signed up for dd and to list the companies involved and then to raise it with the Consumer Affairs People and given that the banks are overall responsible for the dd system possibly the Financial Regulator on the basis that a bill payment system should not be used as a revenue generator for large companies.

Missed a meteor DD, bank charged €12.70 and meteor charge was about €1.10, not so much that it would concern me, seems more like a genuine administration charge.

dub45

foggy_lad wrote: »

Missed a meteor DD, bank charged €12.70 and meteor charge was about €1.10, not so much that it would concern me, seems more like a genuine administration charge.

Irrespective of the amount of the charge were you advised when you set up the dd that you would be charged that amount if you missed the dd?

davo10

The T&C of your contract with ESB and UPC state that you are required to pay amount owed in full each month. They would far prefer this than collecting extra fees when you do not pay. They may be charged by their bank for this, certainly the company is charged an admin fee if a cheque bounces, not sure about dd. they also probably write to you which takes time and costs money.

I cannot imagine the conversation with consumer affairs would go the way you want or expect, you, after all are the one who breached the contract and the company has the right to apply additional charges. This would be the same with missed mortgage repayments, car repayments etc.

dub45

davo10 wrote: »

The T&C of your contract with ESB and UPC state that you are required to pay amount owed in full each month. They would far prefer this than collecting extra fees when you do not pay. They may be charged by their bank for this, certainly the company is charged an admin fee if a cheque bounces, not sure about dd. they also probably write to you which takes time and costs money.

I cannot imagine the conversation with consumer affairs would go the way you want or expect, you, after all are the one who breached the contract and the company has the right to apply additional charges. This would be the same with missed mortgage repayments, car repayments etc.

I am not specifically in this case disputing their right to pass on administration charges. What I am drawing attention to is that a customer when signing up for a direct debit is not advised that they will be required to pay a specific charge in the event of a dd bouncing. Surely this is information that a customer is entitled to? And surely any reputable company should have no problem in advising a customer of such charges?

Are you seriously suggesting that a company should be allowed to apply whatever charges it wishes in the event of a customer missing a direct debit payment which in the cases of most utilities actually is an advance payment for a service not yet provided?

davo10

dub45 wrote: »

I am not specifically in this case disputing their right to pass on administration charges. What I am drawing attention to is that a customer when signing up for a direct debit is not advised that they will be required to pay a specific charge in the event of a dd bouncing. Surely this is information that a customer is entitled to? And surely any reputable company should have no problem in advising a customer of such charges?

Are you seriously suggesting that a company should be allowed to apply whatever charges it wishes in the event of a customer missing a direct debit payment which in the cases of most utilities actually is an advance payment for a service not yet provided?

Dub, by agreeing to the T&C's you are stating that you will pay, there is no onus to advise you of what happens when you do not. The banks charge companies like esb and UPC when a dd has to be reversed from their accounts due to lack of funds in your account.

dub45

davo10 wrote: »

Dub, by agreeing to the T&C's you are stating that you will pay, there is no onus to advise you of what happens when you do not. The banks charge companies like esb and UPC when a dd has to be reversed from their accounts due to lack of funds in your account.

Are you seriously suggesting that we are not entitled to know what charges we may be liable for in certain circumstances?

So let's say you miss a direct debit payment to a company and they charge you €100 - that's ok?

Or say a person making a choice of payment methods is not entitled to know the pros and cons of each method before they make that choice?

jor el

I think that any charges you face, or may face, should be outlined in the T&Cs. If they don't state that there are charges for failed direct debits, or don't say how much the charge is, then a complaint to the NCA about it might be in order.

I would agree that they can charge a fee when a direct debit is returned unpaid, but to not inform the customer of this possibility, or how much the charge will be, is a bit much.

Dudess

dub45 wrote: »

davo10 wrote: »

Dub, by agreeing to the T&C's you are stating that you will pay, there is no onus to advise you of what happens when you do not. The banks charge companies like esb and UPC when a dd has to be reversed from their accounts due to lack of funds in your account.

Are you seriously suggesting that we are not entitled to know what charges we may be liable for in certain circumstances?

No he wasn't saying people aren't entitled to know this - how did you infer that? And obviously a 100 euro charge wouldn't be ok, but it's a bit of a stretch of a suggestion isn't it? Hyperbole not really constructive in fairness.
Dave's point is: the agreement initially is that direct debits won't bounce so there is no onus on the company to provide this info. But no problem asking them.

dub45

Dudess wrote: »

No he wasn't saying people aren't entitled to know this - how did you infer that? And obviously a 100 euro charge wouldn't be ok, but it's a bit of a stretch of a suggestion isn't it? Hyperbole not really constructive in fairness.
Dave's point is: the agreement initially is that direct debits won't bounce so there is no onus on the company to provide this info. But no problem asking them.

So if 100 euro isn't ok what is acceptable? There is no hyperbole whatsoever.

If some unspecified amount is acceptable to you and 100 euros isn't then who decides what is acceptable. And when you sign a direct debit mandate where is the commitment to meet every dd that is presented?

A dd may not be paid by a customer for any number of reasons.

davo10

By agreeing a contract with a provider you agree to pay for the service as per the T&C's, in most cases this is monthly though it may be bimonthly, quarterly or annually. By signing a dd mandate, you are mandating the provider to request and receive payment from your bank and mandating the bank to transfer the funds on request. You must of course have sufficient funds to meet the payment.

So to answer your question, the mandate is your commitment to pay the requested amount, the contract with the provider is your commitment to pay what you owe when you owe it.

Were you charged €100, no you were not. Seems to me that you feel hard done by paying anything at all. You are not required to pay extra fees at all if you pay on time as per T&C's

dub45

davo10 wrote: »

By agreeing a contract with a provider you agree to pay for the service as per the T&C's, in most cases this is monthly though it may be bimonthly, quarterly or annually. By signing a dd mandate, you are mandating the provider to request and receive payment from your bank and mandating the bank to transfer the funds on request. You must of course have sufficient funds to meet the payment.

davo10 wrote: »

So to answer your question, the mandate is your commitment to pay the requested amount, the contract with the provider is your commitment to pay what you owe when you owe it.

You are completely wrong about the role of the dd mandate.

davo10 wrote: »

Were you charged €100, no you were not. Seems to me that you feel hard done by paying anything at all.

Other than your personal arrogance can you provide the basis for this claim? And I never stated that I or anyone else was charged 100 euros.

davo10 wrote: »

You are not required to pay extra fees at all if you pay on time as per T&C's

As pointed out earlier the issue is not about the payment of extra fees the issue is not informing customers of specific fees and that people should not be expected to commit to paying unspecified fees.

schemingbohemia

dub45 wrote: »

A dd may not be paid by a customer for any number of reasons.

No, there's only 1 reason - there wasn't enough money in the account to meet the DD. You can slice and dice it any way you want but when it comes down to it, that's the only reason.

Have you actually read the Terms and Conditions of your direct debits?

keithclancy

schemingbohemia wrote: »

No, there's only 1 reason - there wasn't enough money in the account to meet the DD. You can slice and dice it any way you want but when it comes down to it, that's the only reason.

Have you actually read the Terms and Conditions of your direct debits?

Or there was some sort of administrative f* up and the company is billing the wrong account altogether.

Has been known to happen.

Direct Debit is a crap system, your basically giving a company free reign to take whatever they want out of your account, even if the bill is wrong or something, it'll take you at least a week at the very best to get your money back.

Imagine you get an adjusted bill in the door from the esb for 3 or 4 times your normal bill. You don't have enough in your account, ESB hit your account for it and then charge you for the privilege.

On top of that, the bank can't really stop these Direct Debits either.

I know how the system is supposed to work, in reality its a totally different story and when it goes wrong the onus is on the person whos paying the bill to sort it out, the bank want nothing to do with it, the company just blames the bank and the customer is left holding the can.

I stopped using direct debits around 10 years ago, its a mugs game.

Although the Dutch system is much better, the City Hall took money for a Parking Permit for a car I no longer had on a permit I had cancelled the year before.

Rang them they said: "Send in X Documentation and your refund will be processed within 90 days"

Hung up the phone, went online, clicked "Dispute Payment" entered reason as "Have not lived at this address for over a year"

Within 5 minutes the money was back in my account as my dispute reason was valid.

City Hall rang me back and said that I should pay and then apply for a refund ... I told them since I had my money back the onus was now on them to prove I owed them money.

Never heard from them again.

Best one I've seen is where the ESB was swapped over to someone elses name and then that person left.

Submitted a meter reading a few months later

Next bill ... Total Due : 1850 pounds.

Direct Debit .... 1850 quid gone from the guys account and he didnt get it back.

Eventually he sorted it out with the landlord, but the guy was essentially eating crackers to survive for 2 months, but a meter reading hadn't been submitted in 3 years.

schemingbohemia

Sorry but you're wrong. Read exactly what I stated and then look at your answer and get back to me.

Actually, I'll save you the time. If there was an administrative f*ck up the only way the DD wouldn't have been paid was if there was no money in the account, the fact that an administrative f*ck up took place does not contradict my statement nor does it make it right that it happened.

Whilst you are correct about ceding control by using DD it is very handy for most people to ensure that they don't miss payments.

keithclancy

schemingbohemia wrote: »

Whilst you are correct about ceding control by using DD it is very handy for most people the company to ensure that they don't miss payments.

Fixed that for you.

dub45

schemingbohemia wrote: »

.......................

Have you actually read the Terms and Conditions of your direct debits

There are no Terms and Conditions applying to direct debits.

There is a Direct Debit Scheme for which there is a set of rules.

http://www.ipso.ie/x/File/DD_Rules_V__4_19_Rulebook_Nov_2011_FINAL.pdf

which I can assure you I have read. Therein you will find this important piece of information:

The Direct Debit is a means of payment, and has no direct bearing on the underlying contract between the Payer and the Originator.

schemingbohemia wrote: »

No, there's only 1 reason - there wasn't enough money in the account to meet the DD. You can slice and dice it any way you want but when it comes down to it, that's the only reason.

When a bill payer signs or agrees a direct debit mandate he is not giving carte blanche to a company to access his account as they may wish.

He is entitled to the agreed advance notice, he is entitled not to have disputed charges billed as described below:

Originators must put in place reliable systems and which will ensure:
o the issuance of correct advance notification as appropriate of amounts to be debited
o that Direct Debits as issued conform to Payer instructions and the Rules of the Scheme
o that disputed amounts are not debited

Also prevously cancelled dd's should not be paid and expired dd's should also be returned by the customers bank:

Paying Banks:
o must adhere to the Rules of the Scheme
o must put in place processes which will ensure that unauthorised, refused and/or cancelled
Direct Debits are intercepted and returned immediately on presentation

A bill payer has a right to instruct his bank not to pay a direct debit is he is not happy with any aspect of it (this appears to cause great problems for the bank but that is their problem the entitlement is there).

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

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

dub45

schemingbohemia wrote: »

.......................

Whilst you are correct about ceding control by using DD it is very handy for most people to ensure that they don't miss payments.

It is extremely important for people to understand that once you agree to the setting up of a dd you are no longer in control of your account. There is no upfront protection for your account and it can be debited at any time. It is only when it actually happens to you and you have to fight tooth and nail with bank staff who should know better that you realise how awful a system the dd scheme is.

It is also a fact that no matter how badly a company behaves and how much inconvenience you are caused there are never any sanctions imposed so companies can and do act with impunity as they have nothing at all to fear in respect of their actions.

Any perusal of recent posts in this forum and others on boards.ie will find ample evidence of this fact. Here is a perfect example of what can so easily happen to anyone with a direct debit on their account:

http://www.boards.ie/vbulletin/showthread.php?t=2056502996

In this instance the op was treated appallingly by Three and his own bank all of whom accept responsibilities under the dd scheme rules and then fail to meet them. Will there be any action taken against them? Will pigs fly over Dublin anytime soon?

Not to mention this one where a bank manager displays remarkable ignorance of the dd scheme:

http://www.boards.ie/vbulletin/showthread.php?t=2056515956

Also with the increased use of debit cards and the retention of card numbers consumers are going to find their accounts being debited wrongly also. For example:

http://www.boards.ie/vbulletin/showthread.php?t=2056412869

keithclancy

davo10 wrote: »

Do your T&C with UPC include you paying on time?, this would all be moot if you abided by your commitment to ensure the funds were there to meet your obligation to them. You are making an issue of this here and on other threads, a lot of readers are fed up with people complaining about companies and charges even though it is the poster who has not paid their debt and is at fault. The threads you refer to above are completely different situations to yours.

In fairness if you don't have a Direct Debit they cut you off, if you have direct debit, they cut you off.

If you set up a direct debit which is to their benefit, they whack on an extra charge when there is insufficient funds to pay your bill, or indeed something goes wrong.

The Direct Debit system in Ireland is a JOKE, it's been the same for years, they can have whatever regulations etc they want written down but they are of ZERO use when the company has your money

All the IPSO say is that it should be dealt with in 'a timely fashion' which in reality is between 7 days and 3 months, this is because there are two parts:

1. Disputing the Charge. (The Long Bit)
2. Reversing the Direct Debit. (7-10 working days)

I would never, EVER setup a Direct Debit in Ireland again if I can help it, I pay my bills on time, I've had a number of bills which were wrong and from previous past experience I've had money taken out of my account for something I didn't owe and had to get it back.

The other part of it of course is if you run into Financial Difficulty, the person paying with Direct Debit doesn't have a choice, the money goes out of the account and food etc cannot be paid for.

The person who didn't sign up for direct debit can negotiate a payment plan with the company they own money to.

And to top it off if the person has no money in their account, theres an automatic charge which in effect is a form of flat interest.

You would want to have your head checked IMO to sign up with DD, just pay your bills on time, much less risk and TBH it makes sense to follow where your money is going.

How many people I know off that didn't know they were paying Mobile Phone Insurance for a phone they haven't had for a few years :rolleyes:

davo10

Keith, just a few points, a lot of utility providers either insist on a dd or large deposit when setting up a new account so they are gonna catch you either way if you do not pay on time. Secondly it is not always possible to go to post office/bank/pay on line before a specific date due to work/family/ etc commitments so payment may still be late therefore penalties. Lastly as in OPs case where he uses a service but does not pay on time as he agreed to, it does not matter what the payment method is, they will cut him off if he does not pay what he owes.

The solution to this is simple, pay what you owe as per your contract when you owe it as per the T&C

keithclancy

davo10 wrote: »

Keith, just a few points, a lot of utility providers either insist on a dd or large deposit when setting up a new account so they are gonna catch you either way if you do not pay on time.

Of Course, but if for example you've been with the ESB for 2 years and you move house then just move the account, no need to sign up for Direct Debit.

Secondly it is not always possible to go to post office/bank/pay on line before a specific date due to work/family/ etc commitments so payment may still be late therefore penalties. Lastly as in OPs case where he uses a service but does not pay on time as he agreed to, it does not matter what the payment method is, they will cut him off if he does not pay what he owes.

If you had the time to sign up to the service then you have the time to pay the bills.

The solution to this is simple, pay what you owe as per your contract when you owe it as per the T&C

Indeed, but there is absolutely no need whatsoever in the majority of cases to do that with Direct Debit.

My point is that when it goes wrong the Direct Debit system is just a hinderence and poorly setup without protection for the Consumer.

Giving a Company free reign to directly take money without any form of decent dispute process from your account is just nuts.

I'll give you an example, say the ESB take 4 times what they're supposed to take out, from your current account, then your UPC, Gas and Management fees don't go out as a result.

Now, is it your fault for not making sure there is enough money in your account to satisfy the debt ?

And the ESB will definitely not compensate you for the charges you have to pay to the other companies becuase of their mistake.

No, live in the Netherlands now, the system makes far more sense, instant reversal and a dispute between the two parties on an equal footing, rather than the Customer getting screwed when it goes wrong.

Besides, this forum is called Consumer Issues, not Service Provider Issues.

foggy_lad

New DD rules since last year mean any disputed amount must be refunded to the account within 24hours and if your bank is notified about a disputed amount they must not allow that debit to go through.

Also if the company is continually messing up their debits or sending out bills late thus not giving you the required 7/14 days notice you have an entitlement to cancel the direct debit and pay normally without any penalty or without having to pay any deposit!

dub45

davo10 wrote: »

Do your T&C with UPC include you paying on time?, this would all be moot if you abided by your commitment to ensure the funds were there to meet your obligation to them. You are making an issue of this here and on other threads, a lot of readers are fed up with people complaining about companies and charges even though it is the poster who has not paid their debt and is at fault. The threads you refer to above are completely different situations to yours.

I would appreciate if you would refrain from making this type of false statement.

dub45

davo10 wrote: »

Which part do you consider false?,
Did you pay on time?
Would you have been charged if you paid on time?
Are you unhappy with the charges?
Is your situation the same as the others?
Have other posters expressed annoyance at people complaining about companies when they themselves have not abided by T&C's ?

It is possible to find out about the behavior of companies very easily.

Once again I suggest that you refrain from making false allegations that you have no basis for whatsoever.

dub45

davo10 wrote: »

Dub, seriously which "false allegations"?, answer the questions above and point out what is false, the basis for these questions are your very own posts.

My own posts have been concerned with with the woes of the dd system, the disgraceful behavior of companies towards customers within that system in the full knowledge that these companies will get away with such behaviour and the fact that companies such as UPC and the ESB impose unspecified charges on customers.

I really don't know how anybody can defend the imposition of unspecified charges on anyone or any business or how any body could be expected to sign up to such charges and that was the basis for the thread.

You have chosen in your arrogance and presumptuousness to post allegations about me here for which you have no basis whatsoever. Again I would ask you to desist.

dub45

davo10 wrote: »

Again, could you please specify which ones are false, I would be happy to point you to the relevant posts. The companies actions stem from you not paying your bill on time, you state this in your first post, you state you are unhappy with the charges, these charges would not have been applied if you had funds in your account and paid on time as per T&C, you pointed to other threads but none of them are in a similar situation to you, other posters have posted on other threads about their annoyance with people who cry fowl on companies when it is the poster who did not follow terms of contract.

You signed the contract and broke it.

Which part of this is inaccurate?

Your allegations are inaccurate. I suggest you read the opening post again.

Erper

Same thing happened to me when i went for upc. First they told me all together for connection and having internet is 33e and thats how i got my first bill.
Next bill was 50e with their saying that someone forgot to charge those extra things...
Idiots

token101

dub45 wrote: »

I am not specifically in this case disputing their right to pass on administration charges. What I am drawing attention to is that a customer when signing up for a direct debit is not advised that they will be required to pay a specific charge in the event of a dd bouncing. Surely this is information that a customer is entitled to? And surely any reputable company should have no problem in advising a customer of such charges?

Are you seriously suggesting that a company should be allowed to apply whatever charges it wishes in the event of a customer missing a direct debit payment which in the cases of most utilities actually is an advance payment for a service not yet provided?

Utilities (like electricity suppliers) charge for what you have used based on meter readings. You couldn't possibly be paying in advance.

dub45

token101 wrote: »

Utilities (like electricity suppliers) charge for what you have used based on meter readings. You couldn't possibly be paying in advance.

I used the word "most".

dub45

davo10 wrote: »

Ah, as a moderator you edited the first post to remove the "due to lack of funds" part, way to lose an argument, enough people read the thread though.

Dub, when you click the "follow" button, boards emails you every post that comes on to the thread as it is posted and each new edit.

The "due to lack of funds" is irrelevant. I suggest you read the post.

jor el

davo10 wrote: »

Ah, as a moderator you edited the first post to remove the "due to lack of funds" part, way to lose an argument, enough people read the thread though.

dub45 is not a moderator on this forum, and has no more editing privileges than any other user. I can see what edits were made to the opening post, and your accusations are once again without basis, there was never any mention of lack of funds in the opening post. I suggest you stop this personal vendetta right now.