If you cancel a Direct Debit, can the company still take money?

Paying your bills by Direct Debit can mean it’s easier to stay on top of everything you owe. After all, if your bills leave your account automatically, you don’t need to worry about paying them manually.

But what happens if you don’t want to pay a Direct Debit anymore? If you no longer want services from a company, can you just cancel the Direct Debit? And will the company still be able to take money from you if you do this? Let’s take a look at what happens when you cancel a Direct Debit.

Where did you cancel it?

If you don’t want to pay a Direct Debit, you can cancel this with your bank, building society or alternative account provider. You can do this over the phone or by using your online banking if your account provider allows this.

It’s also a good idea to let the company know that you’ve cancelled their Direct Debit. They shouldn’t be able to take any money from you after this. But if you’ve got an ongoing agreement with them, they might be able to chase you for further payments. For example, if you’re only six months into a 12-month gym contract, the gym might pursue you for the rest of the year’s membership fees.

After you’ve cancelled the Direct Debit, keep an eye on your online banking to make sure your bank doesn’t pay any more money out. If they do, you should be able to get this back.

What can you do?

If your account provider makes a mistake and lets the company take money after you’ve cancelled a Direct Debit, you can ask them for the money back. Under the Direct Debit Guarantee, account providers should provide an immediate refund if they pay out in error. You might still owe the company money but this is for you to sort out – it’s nothing to do with the Direct Debit directly.

Your account provider should pay the money back if it’s made a mistake but until this happens, it might mean you don’t have enough money to pay other bills. If you’d planned to put that money towards another payment, you might now have to find this from somewhere else.

That’s why it’s really important to contact the company you’re cancelling with as well as your bank. This will avoid any confusion and should mean you won’t end up out of pocket at any stage of the process.

If you’re a thinkmoney Current Account customer, you can cancel a Direct Debit through your Online Account Management, by calling to speak to us or by texting us. Find out how to do this with our guide. Just make sure you do this in enough time before the payment is due.