Issues with a Direct Debit
If you spot an error with your Direct Debit (perhaps the wrong amount was taken or it was debited on the wrong day), contact your bank or building society straightaway. It’s the bank that is responsible for refunding you in the event of a mistake, even if the original error was made by the organisation collecting the payment.
The Guarantee only protects the set up or collection of your Direct Debit payments. It doesn’t cover you if you have a dispute with the biller, or the company goes into administration.
Most banks or building societies will have questions before they can process a claim – that’s not just to make sure it’s legitimate, it’s also to help them deal with the collecting organisation. Once an error in the payment of a Direct Debit has been established, you will be refunded immediately.
No. If you owed the organisation money before, you’ll still owe them that money and it’s up to you to pay by alternative means. There are, unfortunately, scammers offering to facilitate refunds via the Direct Debit Guarantee in return for up to 50% of the money. Those fraudulent refunds can subsequently be reclaimed by the organisation, leaving the account holder substantially out of pocket as they have to repay the full amount of the refund despite having already handed a large portion over to the scammer.
Organisations using Direct Debit go through a careful vetting process before they're authorised and after that, they’re closely monitored by the banking industry. If money was to be collected from your account fraudulently, you'd be protected by the Direct Debit Guarantee, which means you would be entitled to a refund from your bank or building society.
Firstly, check back on any Direct Debits you’ve set up recently. Sometimes the name of the organisation taking the Direct Debit may not be the same as the company you signed up with, for example, some organisations use their parent company name or it could be that the payment is going to a finance company.
If you still don’t recognise the Direct Debit, contact your bank or building society and ask to see a copy of the Direct Debit Instruction, which your bank should have access to within 7 working days.
While that’s being obtained, you may be entitled to an immediate refund of the amount debited from your bank or building society under the Direct Debit Guarantee. If it turns out the Direct Debit is legitimate, your bank will re-debit the amount owed from your account.