If you are an adult, you may long for your childhood days when you did not concern yourself with money matters. However, as an adult, your reality now involves making recurring payments for utility bills, rent, and other financial obligations. Sometimes, keeping track of when and how much to pay these bills can be overwhelming. Fortunately, you can use Direct Debit Services to manage your recurring invoices for you.
What is Direct Debit?
When you enter into a direct debit payment system, you are instructing your bank to allow collectors to debit varying amounts of money from your account based on an agreed schedule of quantities and dates. Once notified, your bank will allow the automated deduction of funds from your account and transfer it to your collectors. As a form of guarantee, your bank must refuse the debit of amounts that are not clearly stated in the agreement.
What is a Direct Debit Guarantee?
When you enter into a direct debit agreement with a bank, the bank will guarantee that your rights are protected. Your bank will carefully vet any collecting organisation that you enrol in your direct debit agreement. Your bank will protect you in events of errors in your payments. Banks will also ensure your rights by:
- Refusing any direct debit transactions if the amount being collected does not match the previous agreement. This safeguard guarantees that the collecting organisation cannot change payment amounts without your approval first.
- Refusing any direct debit transactions that do not fall on the agreed schedules.
- In case of errors in payments, your bank will immediately refund the full amount made by mistake.
- Your bank allows you to cancel direct debit services at any time through the proper process.
How to Manage Your Direct Debit
Once you have a direct debit system in place, you can rest assured that you will not miss any recurring payments. The direct debit services will manage your payments for you. All you have to do is be on top of the payments by ensuring that your bank account has enough funds. However, it is still best to monitor your direct debit system regularly.
- You are required to be notified at least ten working days in advance of any changes to the amounts that you need to pay or the changes in the schedule of payments. It is the collecting organisation that must notify you about the differences. If you agree to the changes, you have to instruct your bank to accept the changes as well.
- You should always check your bank statements and make sure that the direct debits noted in your accounts match the schedule of payments in your agreement. Checking your bank statements is also one way to make sure that you still have enough money in your account and to avoid getting penalties when you overdraw your account.
What is the Main Benefit of Direct Debit Services?
Using Direct Debit Services is the safest way to pay your recurring bills. With direct debit, you will have these following benefits:
- You do not need to go out to your bank or payment centres to pay for bills every time they are due per month. With direct debit, they are automatically debited from your accounts.
- You can be assured that your bank has carefully vetted the organisations that you are paying your recurring bills. This vetting system will give you peace of mind that these organisations cannot change the terms without your bank and yourself knowing about the changes.
- Your bank is obligated to protect your rights and your money when you enter into a direct debit agreement.
Although you can never go back to being a child and be worry-free from money matters, with direct debit services, at least you can lessen your worries with your recurring payments.