Does this sound familiar?

 Bacs and its member banks hold regular consumer research programmes throughout the year to try to identify any key Direct Debit problem areas and how to resolve them.

Here are some of the common enquiries your customers may raise and tips on how best to prevent them.

The Direct Debit payment was never made

In some industries a non payment could be frustrating, for example a life insurance premium or mortgage repayment, whereas in others it could be seen as an inconvenience. The point is that when you set up a new customer on Direct Debit you must ensure that the first and subsequent payments are collected on time as advised to your customer.

 Best practice tip:

• Do you have modulus checking?
• Is there a diary system in place to check for payment dates?
• Are you using AUDDIS to electronically set up the Direct Debit Instructions?
• If you discover a payment(s) has not been paid before sending a payment overdue letter to your customer check you have tried to collect the payment.
• If the error is yours contact the customer to advise them and offer to spread the payments over a period of time or if required write off the amount.

Even though the Direct Debit had been cancelled you still took money out of my account

This instance causes intense annoyance with consumers. For some it is the inconvenience of having to rectify the problem, seek refunds and double check that the Direct Debit is definitely cancelled. For others it can cause unnecessary unpaids to occur which may result in you not only having to settle an indemnity claim but also a refund of their bank charges.

This one, more often than not tends to put people off Direct Debits for life. It can undermine a lot of goodwill. Whilst the Direct Debit Guarantee is there to safeguard the customer in this instance offering an immediate refund will not help to restore confidence in the system and indeed your organisation.

Best practice tip:

• Are you actioning your ADDACS reports?
• Do you receive them in paper format? If so, consider receiving the information electronically so it can be used to automatically update the details on your database
• If the customer requests a cancellation it is crucial you carry it out straightaway and check whether a payment is already on its way
• Always advise the customer to cancel the payment with their bank as well especially if a payment is in progress. Most banks will accept these instructions over the telephone.

You debited my account twice this month

This is often not the fault of either you or the customer. Even with AUDDIS setting up a Direct Debit can take time, for example delays by the customer in returning the form. On a monthly billing cycle the incidence of the lateness of the first payment against the timing of the next payment can lead to such perceptions.

Best practice tip:

• Can you speed up the application process in any way?
• Are you on Paperless Direct Debit? The quickest way by far to set up a new Direct Debit
• Ensure you have a watertight advance notice system in place. Many customers will forget they have a payment due.

You debited my account more than the agreed amount

This is a highly sensitive issue. No one likes paying bills at the best of times but to see an entry on the bank statement that is more than expected will almost guarantee an immediate phone call to your help desk. Some customers may invoke the Direct Debit Guarantee and seek their money back.

Here your relationship with the customer reaches a critical point as they may decide to move their business elsewhere. Even if you are operating in a closed market where there is no competition, for example council tax, they may revert to a traditional method thereby undoing all the hard work and expense incurred in converting them to Direct Debit in the first place.

 Best practice tip:

• Consumers are generally financially astute when it comes to paying bills. Never deviate from the advance notice rule
• If you have to change the amount then you must advise your customers
• Do not sacrifice quality over cost savings. A personalised letter advising of any increase is one of the best methods. Email is fast but you have to be sure that it has been received and read.