Martin Lewis warned bank account holders across the UK they could be having their money taken out of their accounts every month without even realising. The Money Saving Expert made the revelation in his most recent Money Show episode in which he urged consumers to note a key difference.
Martin warned consumers may not be aware of the difference between direct debit and recurring payment setups and if they’re not, they should check their bank statements immediately.
Angellica Bell, Martin’s co-host, noted she had heard of recurring payments but said many are likely to assume they’re the same thing as a direct debit.
Martin quickly refuted this, noting: “A direct debit is when you give your sort code and your account number and they take the money each month.
“A standing order is when you set it up yourself to make a regular payment each month, quarterly or whatever.
READ MORE: Bank of England prepares first clear break from EU
“And they owe you the money. You can go to the Ombudsman.”
According to the financial Ombudsman themselves, the main types of complaints they see, with standing orders and direct debits specifically, is when a current account provider has paid a direct debit or standing order it shouldn’t have done – or has failed to make a payment that was due.
For continuous payment authorities, consumers sometimes complain about the difficulty in cancelling such a set up, either with a business taking the payments or with a card provider.
Alternatively, consumers may complain about the continuous payment authority themselves.
When examining these types of complaints, the Ombudsman will ask the complainant to provide certain information.
They will then make their decision about what happened using evidence provided by the complainant, the bank involved and any relevant third parties.
In reaching their decision, they’ll consider:
- The relevant laws
- Any regulations that applied at the time of the complaint
- Any industry codes of conduct in force at the time
- The terms and conditions of the account that the disputed transaction was made from and
- Any specific considerations concerning direct debits or continuous payment authorities
Do you have a money dilemma which you’d like a financial expert’s opinion on? If you would like to ask one of our finance experts a question, please email your query to [email protected]