When you use Direct Debits to keep on top of your bills, it’s still up to you to make sure there’s enough in your account when payments go out. If you don’t your payment will bounce and be returned unpaid.
We already took you through what returned Direct Debits are. Here we’ll run through how long it takes for a Direct Debit to be returned unpaid, so you can have the best possible chance to avoid this happening.
Direct Debits are different to card transactions because the money doesn’t leave your account right away. In fact, the process of payment can take at least three days – and this can become confusing if a payment is returned unpaid.
What’s important is that there’s enough money in your account between 7.30am and 10.30am on the date a Direct Debit is due. If there isn’t, the Direct Debit could bounce and your account provider might charge a missed payment fee.
Second chance to pay
If your bank, building society or account provider makes this payment on a first attempt and there isn’t enough money to cover it, it will bounce. Some banks can charge when a payment bounces, because they need to process the transaction again.
But under a new system that came into play in September 2014, banks will try to take the payment again between 2pm to 2.30pm on that same day. This window gives you extra time to top up your account and avoid a missed payment charge from your bank, service or utility provider, as well as cancelled subscriptions.
Though some services might just take double the amount with next month’s Direct Debit, it’s better to ensure all payments go on time. You won’t want to fork out charges from the company and have to budget for a double payment or deal with cancelled services and subscriptions.
We won’t charge
Unlike banks who charge for a returned Direct Debit, we won’t charge you for late or missed payments. We will manage your account carefully and notify you on the payment date if the balance isn’t enough to cover your Direct Debit. This gives you peace of mind that you can pay in cash and ensure bills and payments are covered.
If you realise that you’ve not got enough in your thinkmoney Personal Account to cover a Direct Debit, get in touch with our Money Managers. They can take a look at your budgeting with you and see if there are any upcoming bills they can temporarily free up money from.
Set a budget
Budgeting everyday finances can be tough, especially with the long list of outgoings most of us have. It’s not so easy juggling money to cover all your costs and making sure there’s enough in your account to get through until pay day. And if your income varies from week to week – if you get Jobseekers’ Allowance, for example – it can be taxing prioritising bill payments.
A thinkmoney Personal Account can be another way to stay on track of your finances. We’ll help you set aside the right amount of money needed to cover the regular bills you tell us about. Your money is split into two – one pot to cover all of your bills and financial commitments and the rest of your cash set aside in your card account. That way, you can keep track of what you spend and still have peace of mind that your bills are paid on time.
The thinkmoney Personal Account has a monthly management fee of £17.50 for a single account and £24.50 for joint accounts.