Have you ever had a membership, gyms are notorious for it, you have a direct debit, money coming out of your account and you decided to cancel your membership, but guess what they kept taking the money? No matter how many times you approach them, you can’t seem to get them to stop.
Sound familiar, has this happened to you?
Let me tell you what I know about direct debit, companies such as gyms set up these payment collection systems to gather their monthly membership fees, they are the perfect solution for the business owner, as they simply collect the monthly payments automatically on their behalf. But for the consumer, it’s a whole other story, they catch you in with an incentive, if you pay by direct debit. Utilities are good at this as well, cheaper fee etc if you pay by direct debit. Some will not even allow you to join if you want to go the manual path of paying yourself. No direct debit, no membership.
Some even take the money out on different days of the month, it’s not like you can even plan ahead to have the money ready for payment. How could they just debit your account anytime they like, well when you signed the paperwork, I’m guessing it didn’t state a date, just an amount, so watch out for that, make sure it has a set day of the month, day 15 for example
The next thing to watch out and this is an insider tip. I found that my bank could place a stop on the payment being drawn from my account, because I requested it coming from my BSB & Account number, after I had tried to stop the payment by contacting the company, if they continue to draw the money, I can have the bank place a block on the payment. This works only for payments coming from a bank account.
If I have set up a direct debit on my credit card for instance, then this cannot be blocked at all. The only way to stop that payment from the credit card is to cancel the card. So just check with your own bank how this works, go into your bank and ask the friendly staff.
If I have a direct debit on my account, is there a way to block this payment if I want it to stop.also if the payment is coming from my credit card, can this be blocked if I don’t want to give the company the payments anymore?
Being a banker over the years I have seen direct debits coming out for months after the person has cancelled the membership. So personally I steer well away from them, with internet banking you can set up recurring payments with BPAY, so you can control the payments, not the other way around.
For more money tips, visit the Talking Money With Rhonda Blog