Incorrect payments and refunds

A Direct Debit is known to be one of the safest and easiest ways to pay for your products and services, but as with anything errors can occur. Whether you’re a customer who has entered bank details incorrectly or a business that has taken a payment a day early, we have got you covered on what to do.


Check the Direct Debit set up details

When a Direct Debit is set up all parties should be aware of the amount due to be taken and the date in which this will be deducted from an account. A document known as an ‘advanced notice’ will be issued to the bank account owner. If the amount taken or the transaction date differs from what is stipulated on the advanced notice, an immediate refund may be available as part of the Direct Debit Guarantee.

An important thing for both customers and businesses to check is whether the payment date has been changed to allow for an upcoming bank holiday or weekend. If a payment is set to fall on a National Holiday e.g. Christmas Day it is common practice that the payment date will be changed to a day further in advance e.g. December 28.

On occasion, a payment may be deducted earlier than expected. Where this is the case, notification should be given to the account holder.


What to do when you are certain an error has been made

Once you are certain an error has been made, the bank in which the account is held should be contacted immediately, either face to face or via email, letter or telephone communication.

It is helpful to know that if an unauthorised payment has caused you to become overdrawn you can also claim back these additional charges.

Payment errors should be refunded immediately. Where this is not done a complaint can be raised with the bank in question directly or through the Financial Ombudsman.


Delays in refunds are possible

In many instances, a refund is not immediately paid because the bank and the organisation that mistook the payment will need to liaise with one another.  Your bank should give you a rough timescale on how long they think this will take. It is also important to remember that the bank is the party that is responsible for chasing the refund, meaning the process is relatively stress-free for customers.

If you are a business and you have been made aware by a customer that an error has been made, whilst it can be frustrating to hear, you must make the customer aware that for data protection and security purposes only the account holder can report the error.


Further guidance

Whilst we hope the above has clarified the course of action one should take if a payment error has occurred, however further help and support can be found for DFC customers/ clients by calling the dedicated helpline 01908 422 000 or by completing an enquiry form.

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