Plusnet Direct Debit

Why are Plusnet asking me to pay by direct debit?
One of the worst banking payment facilities ever invented - so corrupt now that BACS ignore new mandates !!
What is wrong with the straightforward debit card !!?

Wagstaff

I've used DD for years and never had any problems.

There's been a lot of debate on Plusnet forums and I come down heavily on the side of paying all my bills by DD and wouldn't do business with any company that wanted me to give them a continuous authority on a card.

It was only recently that I discovered the flaw in the DD system.
Once a company - any company in the world - has hold of your bank sort code and bank account number, they can apply through BACS for a payment against your account, without your authority and without your knowledge.
The crucial point is that they don't need a DD mandate to do this !! Your bank doesn't check for an authority !!
Hard to believe, I know, but that is the reality.
True, I understand, the debit card system is a risk, but you usually know when and who you're paying, the amount, and you normally obtain a receipt. The recipient has access to your card, but not your bank account.

Wagstaff

Why are Plusnet asking me to pay by direct debit?

The amount due is requested by the vendor, requiring no input from the customer. This is all very well providing the vendor informs you of any increase before it's actually taken.

It is therefore better for the vendor when amounts due can vary, and basically ensures that you don't accidentally miss a payment.

Once a company - any company in the world - has hold of your bank sort code and bank account number, they can apply through BACS for a payment against your account, without your authority and without your knowledge.

Not according to this link

That sounds rather like an urban myth to me - please give evidence (links) to back up your assertion.

Edited by jelv (Sun 23-Jan-11 22:04:01)

In reply to a post by Wagstaff:

...
True, I understand, the debit card system is a risk, but you usually know when and who you're paying, the amount, and you normally obtain a receipt. The recipient has access to your card, but not your bank account.

???

First, I don't quite see the difference between putting a payment through on a debit card or a direct debit, as both remove money immediately from your bank account.

In fact a d/d does require prior notification to you, 10(?) days beforehand, of the amount that will be taken. I'm not sure a debit card does.

If he has your card details, he's away wiv da dosh!

More importantly, a CCA on either a debit or credit card is inherently unsafe, as you cannot revoke the authority. Only the party with the authority can cancel it. All you can do is write, (in any provable form), to them telling them you no longer authorise it.

That can be used to persuade your bank that any subsequent debits are illegitimate, but I believe the onus is on you to demand a refund on that card from the debiter.

Even cancelling the card and getting it replaced by another with a new number is useless. The new card can still be charged.

On the other hand, you can revoke a d/d authority at your bank, and you are fireproof. If unauthorised monies are later taken via that d/d the bank have to refund you. How they get it back from the debiter is their worry.

'Once a company - any company in the world - has hold of your bank sort code and bank account number, they can apply through BACS for a payment against your account, without your authority and without your knowledge. The crucial point is that they don't need a DD mandate to do this !! Your bank doesn't check for an authority !! Hard to believe, I know, but that is the reality.'

Yes, but should any company in the world do that without your bank holding a mandate then once brought to their attention the refund is immediate and is marked as an unauthorised transaction. Can't argue with your statement though. All you say is true.

In reply to a post by RobertoS:

In reply to a post by Wagstaff:

.

???

First, I don't quite see the difference between putting a payment through on a debit card or a direct debit, as both remove money immediately from your bank account.

In fact a d/d does require prior notification to you, 10(?) days beforehand, of the amount that will be taken. I'm not sure a debit card does.

If he has your card details, he's away wiv da dosh!

More importantly, a CCA on either a debit or credit card is inherently unsafe, as you cannot revoke the authority. Only the party with the authority can cancel it. All you can do is write, (in any provable form), to them telling them you no longer authorise it.

That can be used to persuade your bank that any subsequent debits are illegitimate, but I believe the onus is on you to demand a refund on that card from the debiter.

Even cancelling the card and getting it replaced by another with a new number is useless. The new card can still be charged.

On the other hand, you can revoke a d/d authority at your bank, and you are fireproof. If unauthorised monies are later taken via that d/d the bank have to refund you. How they get it back from the debiter is their worry.

How wrong can you be, Bob?
I can't believe that you could say such a thing!!
First of all, when you use a debit card, the transaction happens immediately, you use a thing called a PIN.
When you set up a direct debit, the transaction happens when the recipient decides to access your account.
How difficult is that to understand ?!!

Wagstaff

DD you have more protection on than anything else best way to pay

In reply to a post by wingco1:

Once a company - any company in the world - has hold of your bank sort code and bank account number, they can apply through BACS for a payment against your account, without your authority and without your knowledge.

Not according to this link

That's what BACS want you to think.
The truth is that you have to be the inquiring party - that means checking your statement every month.
How many of us do this?!!

Wagstaff

In reply to a post by Cobra001:

DD you have more protection on than anything else best way to pay

That's what BACS want you to think - but you have to be positive about implementing the enquiry.
It shouldn't be that way !!

Wagstaff

In reply to a post by jelv:

That sounds rather like an urban myth to me - please give evidence (links) to back up your assertion.

Sorry - I don't understand.
What sounds like an urban myth?

Wagstaff

paying my debit card would cause a lot more support issue I think. You imagine thousands and thousands of customers all with cards that expire every few years. That alone, equates to many expired cards, per day.

I phone bank up and they do an instant charge back, no paper work. If you do it by credit card you have forms to fill in and questions to answer.

Also you can tell the bank to refuse dd from x company

First of all, when you use a debit card, the transaction happens immediately, you use a thing called a PIN.

Err, unless I'm missing something but you don't give your PIN to companies when you are paying by Debit Card online... or if you do, you are being (IMO) incredibly stupid!

I assumed you meant a CCA on the debit card, in the same way as one on a Credit Card.

I'm not surprised they won't accept on-invoice debit card transactions. Does any ISP?

In reply to a post by Wagstaff:

The truth is that you have to be the inquiring party - that means checking your statement every month.
How many of us do this?!!Wagstaff

I check mine, on line, every working day and can see the next days DD transactions in advance.

I rarely pay by debit card - Aldi is the one exception and the only time I use one on line is to pay car road tax.

In reply to a post by Wagstaff:

that means checking your statement every month.
How many of us do this?!!

How many are silly enough not to?

In reply to a post by csogilvie:

First of all, when you use a debit card, the transaction happens immediately, you use a thing called a PIN.

Err, unless I'm missing something but you don't give your PIN to companies when you are paying by Debit Card online... or if you do, you are being (IMO) incredibly stupid!

True - you would never give anyone your PIN.
But when I pay online, I usually have to enter a password.

Whenever you use your debit or credit card, you control the transaction. In the Direct Debit system, the originator/recipient controls the transaction.

In reply to a post by Wagstaff:

In the Direct Debit system, the originator/recipient controls the transaction.

Must disagree as I can cancel DD, in seconds on line, and have guarantee.

Once you give continuous authority on a credit or debit card you lose all control

In reply to a post by Oldjim:

Once you give continuous authority on a credit or debit card you lose all control

Can you set up a continuous authority on a debit card?

AFAIK that wouldn't be the same as setting up a Direct Debit, which can be cancelled at a moment's notice and carries a guarantee.

In reply to a post by wingco1:

Not according to this link

Thanks for the link. I've taken a paragraph from the website which is patently not true.

"The organisation will update their payment records and forward the Instruction onto your bank or building society. The Instruction, to your bank or building society, gives the organisation authority to collect varying agreed amounts from your account on dates agreed with you."

The direct debit mandate you fill out never reaches your bank, even though it is supposed to be your authority for payments to proceed.

In reply to a post by billford:

In reply to a post by Oldjim:

Once you give continuous authority on a credit or debit card you lose all control

Can you set up a continuous authority on a debit card?

AFAIK that wouldn't be the same as setting up a Direct Debit, which can be cancelled at a moment's notice and carries a guarantee.

Not sure why you linked to my post which was referring to the pitfall of continuous authority but in answer to the question you raised http://www.moneysavingexpert.com/banking/recurring-p...

Recurring Payments. You give companies your card details

The key to Recurring Payments, known as Continuous Payment Authorities until a few years ago, is the company will ask for the long number across the centre of your credit or debit card rather than your bank details. If this happens, you need to be aware an entirely different set of rules come into play.
Q. Why are Recurring Payments so dangerous?

A. Recurring payments effectively mean you give a company your debit or credit card details and say 'take a payment whenever you think I owe you".

While money comes out regularly, each payment is a seperate transaction, so there's no easy 'off-switch' at your bank. The company's registering a charge on your card, and if it wants to keep charging, it can. In other words....

You CAN'T CANCEL them. Only the company you're paying can do that!

This is because there's no automatic right to ask your bank to stop the payment, it's all about your relationship with the company you're paying. So if you have a problem, you need to dispute it rather than just cancel.

Hopefully, reputable companies will stop filching money when asked. Yet issues galore can crop up - it only takes a small glitch for it to become a nightrmare... if the company's difficult to contact, going into administration or, worse still, dodgy, you could be stuck paying again and again for something you don't need or want with no recourse.

At that point you need to get into a dispute procedure with the bank, and it can sometimes mean huge effort to stop it.

The worst cases come from when it's a little known company, based outside the UK, so there's less legal recourse. Speaking frankly, one of the biggest danger zones is some pornography websites, they exploit the embarassment factor which stops people complaining, leaving some paying unnecessarily for years.

I beg to differ there mate - I recently had an 'Account Review' and during said review, the Bank Manager produced a copy of a DD that I'd agreed to some months before (with Argos I believe it was.)

So obviously some DDs do get through to the Bank!

the long number across the centre of your credit or debit card

I didn't know you could do that on a debit card, one lives and learns

Thanks.

Don't think I'll bother though, I'll stick with Direct Debits

In reply to a post by nadger:

Must disagree as I can cancel DD, in seconds on line, and have guarantee.

You mean after the transaction event - by which time the originator has your money.

In reply to a post by WelshWArrior:

I beg to differ there mate - I recently had an 'Account Review' and during said review, the Bank Manager produced a copy of a DD that I'd agreed to some months before (with Argos I believe it was.)

So obviously some DDs do get through to the Bank!

So you saw the original piece of paper that you signed giving your authority for payments. I am surprised and stand corrected. Can't understand how the fully automated BACS would cope with all these little pieces of paper flying around the system !
Did this apply to all your DDs?

guarantee you get it back from your Bank.

He printed it there and then so I cannot comment on whether the Bank holds the original or not, just that it was on-screen and then printed.

In reply to a post by WelshWArrior:

He printed it there and then so I cannot comment on whether the Bank holds the original or not, just that it was on-screen and then printed.

My bank, too, can print me a list of direct debits - all of which (I hasten to add) are now cancelled.
Would you believe, they retain them for "archive" purposes !!

yes because you can go back and do a charge back later on.


also banks are required to hold least data for 7 years, just as you are meant to

In reply to a post by Cobra001:

yes because you can go back and do a charge back later on.


also banks are required to hold least data for 7 years, just as you are meant to

Don't understand. Why would I want to do a "charge back"?
Cancelled DDs do have one purpose, and that is to prevent originators (using the same code) from accessing your account.
I assume that they (the originators) could, of course, use a different code !!

This wasn't just from a 'list' it had my Signature on it!!

In reply to a post by Wagstaff:

It was only recently that I discovered the flaw in the DD system.
Once a company - any company in the world - has hold of your bank sort code and bank account number, they can apply through BACS for a payment against your account, without your authority and without your knowledge.
The crucial point is that they don't need a DD mandate to do this !! Your bank doesn't check for an authority !!
Hard to believe, I know, but that is the reality.
True, I understand, the debit card system is a risk, but you usually know when and who you're paying, the amount, and you normally obtain a receipt. The recipient has access to your card, but not your bank account.

My bold

Wagstaff

That sure makes writing a cheque unsafe does it not? It is all there.

Used DD for many many years and not a problem. Do I trust any banking 100% no indeed but I check my account daily. Good job I did because a year ago my wife must have popped over to Miami without me knowing and had a tattoo, at least that is what the debit on my CC indicated.

If I wanted I could cancel all the Direct Debits on my bank account, online banking lists them all with simple Cancel button.

The button exists even before the first payment has been made, i.e. the form has been processed by bank but no payment taken yet.

In reply to a post by Sadoldman:

That sure makes writing a cheque unsafe does it not? It is all there.

Probably why they're doing away with cheques.

A couple of years ago, my bank rang me & asked if we had been in USA, we hadn't.
Our account (debit card) was showing $3.50 for a cup of coffee from a New York cafe.
They cancelled the card & issued a new one + a refund.

In reply to a post by MrSaffron:

If I wanted I could cancel all the Direct Debits on my bank account, online banking lists them all with simple Cancel button.

The button exists even before the first payment has been made, i.e. the form has been processed by bank but no payment taken yet.

Yep, paperwork must reach the bank as mine show up the same.

However although I don't know the reason, you may not be able to cancel them all online.

I have cancelled several in the past once they were no longer needed, but one came up with an error message, along the lines of "You cannot cancel this direct debit through direct banking, please contact your branch".

The girl I spoke to there didn't know the reason, just that some d/ds are like that. She cancelled it for me with no problem.

In reply to a post by MrSaffron:

If I wanted I could cancel all the Direct Debits on my bank account, online banking lists them all with simple Cancel button.

But they still sit there on your account, like broken kerbstones, waiting for you to trip over them.

In reply to a post by Wagstaff:

In reply to a post by MrSaffron:

If I wanted I could cancel all the Direct Debits on my bank account, online banking lists them all with simple Cancel button.

But they still sit there on your account, like broken kerbstones, waiting for you to trip over them.

Are you saying you do use them? Then why not for Plusnet? If you aren't, how do you know?

I think they probably disappear at Financial Year end or something. In my 30 or so D/Ds and SOs there is only one showing as Cancelled, with a last taken date of 15 Aug 2010.

That one is interesting. It is O2, clearly for my mobile phone, but there is a replacement for it with a different Reference but the same amount. I don't think I shall bother investigating.

In reply to a post by Wagstaff:

In reply to a post by Sadoldman:

That sure makes writing a cheque unsafe does it not? It is all there.

Probably why they're doing away with cheques.

Not so. People use plastic nowadays and of course Direct Debit for the regular payments.

Quite frankly to take monies that has not been authorised as you are suggesting must be a fraudulent act, and if my bank does not have my authority to make the payment...well it is their problem not mine.

Ooohhh! TFH time

In reply to a post by RobertoS:

Are you saying you do use them? Then why not for Plusnet? If you aren't, how do you know?

I think they probably disappear at Financial Year end or something. In my 30 or so D/Ds and SOs there is only one showing as Cancelled, with a last taken date of 15 Aug 2010.

That one is interesting. It is O2, clearly for my mobile phone, but there is a replacement for it with a different Reference but the same amount. I don't think I shall bother investigating.

I did use DDs quite a lot, until I hit a problem with one mandate that I had completed which never reached my bank.
It was then that I was told "we never send mandates to the bank - it's an automatic system, if there's a problem the bank will let us know". What !!!
So I've based all my comments in this thread on the assumption that this was the general practice.
From your comments and those of other posters, I'm clearly wrong in my assumption, and I realise now that I should have qualified my comments with the phrase "in my experience". Apologies for not having done so.

Sounds like that one place had a strange setup. Were they actually managing to take money on d/d, or was that the problem - they couldn't?

In reply to a post by wingco1:

Ooohhh! TFH time

Help

Acronym finder no help with that one, unless it is Thread from hell which doesn't seem to fit.

Tin Foil Hat ?

Correct

In reply to a post by Sadoldman:

Quite frankly to take monies that has not been authorised as you are suggesting must be a fraudulent act, and if my bank does not have my authority to make the payment...well it is their problem not mine.

I've noticed in the past money disappearing from my account, eventually to be returned, but only after my questioning the transfer. "Sorry sir, it was a banking error".

In reply to a post by RobertoS:

Sounds like that one place had a strange setup. Were they actually managing to take money on d/d, or was that the problem - they couldn't?

They only reason they couldn't actually take the money was because they hit a previously cancelled DD with the same originator code and reference. My bank never saw the new DD mandate.

Gosh this is a weird thread! Like others who have posted, any DD I set up, by whatever means, online, paper, within a few days, without exception, appears on my account online and I can monitor exactly what happens to it, cancel it if I want to, etc. I believe they drop off if not used for 13 months, although I'm perfectly happy for my bank to have an archive record of it in case of any query. Not having DDs would be an inconvenience to me as well as the organisations that I pay using them.

In reply to a post by Wagstaff:

In reply to a post by RobertoS:

Sounds like that one place had a strange setup. Were they actually managing to take money on d/d, or was that the problem - they couldn't?

They only reason they couldn't actually take the money was because they hit a previously cancelled DD with the same originator code and reference. My bank never saw the new DD mandate.

Well there's the explanation.

A little true story from about a month ago.

A couple of years ago M & S opened a "Simply Food" near here, which we use quite a lot. They also have the main daily papers.

We have a Times subscription and get our paper from the small newsagent round the corner, using the coupon. They are a bit daffy and no longer keep papers for regular buyers, so sometimes they are sold out. M & S, when asked a few times of different staff, said they didn't take the coupons so we had to go a bit further to Sainsbury's.

But a month ago this happened, and with the Christmas traffic I decided to pay up at M & S. Just on the off-chance I asked if they took the coupons these days, and the answer was "Yes". Great.

I then watched the till-girl tear up the coupon and bin it after crediting the shopping total. (Which you may or may not know is what they do with their own Reward Vouchers, to prevent re-use by anyone).

When I said to her that she shouldn't be doing that as it had to be reclaimed, she repeatedly assured me they didn't bother, just did the same as with the Reward ones.

Last week I used another Times coupon there and it was duly put in the till. I queried the earlier episode with him, (a fairly senior member of staff), and he was quite taken aback. The other girl was wrong.

Apply the story to what you just described. You probably spoke to the person that binned the lost mandate. They must have sent the original one.

one case where there was a DD that went out of my account every 6 months that I had not spotted, it had been going on for nearly 2 years and they did a charge back all the way to the start

You certainly need to check were Plus is concerned in the last round of sending out notices for the DD to be taken they managed to double the amount and actually take it where debit card customers were concerned.

10 days notice, if only.....Plus give three days, much against the industry standard of 10 working days.

Been with them 3.5 years and always paid by DD with no problems.

I check my accounts as a matter of course and not because I'm worried about any specific supplier.