Cancelling Direct debit payments - what merchants and payers need to know (2024)

FAQs

Cancelling Direct debit payments - what merchants and payers need to know? ›

Cancelling Direct Debits - what merchants need to know

Who actually controls Direct Debit payments? You do. As the account holder, you can cancel any time you want, just as you can set up a Direct Debit Instruction. Outside of that, your bank or building society is responsible for running your account, including all payments, such as Direct Debit.

In this case, the company could take action against you if you do not pay. If you don't notify the company, there could be a delay in communication between them and your bank, and they could mistakenly charge you. If they do, you should be able to calm this back through the direct debit guarantee.

Cancelling your direct debit in a branch

You can visit us in a branch or at a business banking centre to cancel a direct debit. You'll need to fill out and submit the direct debit cancellation form to us when you're in the branch.

The Direct Debit guarantee is the Direct Debit scheme's customer protection. The guarantee is offered by all building societies and banks who accept direct debits. As a customer, the Direct Debit Guarantee protects you against payments made in error or fraudulently.

It's best to contact the company taking the payment first and ask it to cancel it. If it refuses, you can also contact your bank or card provider and tell it to cancel it. The Financial Conduct Authority states that banks MUST cancel a recurring payment when asked.

The third party uses a bank or third party processor to deduct the agreed amount of money from the account holders bank account. Only the third party or company the customer has signed the agreement has permission to cancel the debit order.

It's important to remember that cancelling the Direct Debit simply stops payments from going to the organisation you are paying. If you still owe money for something you've bought, or are still receiving a service, you'll need to organise another way of paying.

Call and write the company

Call the company and tell them you are taking away your permission for the company to take automatic payments out of your bank account. The company's customer service should be able to help you, and there might be an online form you can use. Then, follow up by writing a letter or an e-mail.

If you notice an error on the same day a payment was made, you can call your bank and reverse the payment immediately. However, if you notice it at any point afterwards, your bank will need to make an 'indemnity claim' to the collecting organisation on your behalf.

Do you need a notice to cancel a direct debit? ›

Make sure you cancel at least a full day before a Direct Debit is due to be collected. Otherwise, it's possible that the payment might already be what's called “in flight” and can't be stopped. The best thing to do if you are unsure is check how much notice your bank or building society needs.

Stopping direct debits from your bank account

To cancel a direct debit from your bank account, contact your bank: tell them when you want to stop the payments. ask them for a letter confirming your request.

Ending direct payments

You can ask to stop receiving direct payments at any time. The LA must stop making direct payments if you stop being eligible to receive them.

A Direct Debit can only be set up by the organisation to which you're making the payment. Normally, you sign a mandate that gives the company permission to take funds from your account in an agreed way – like a monthly gym membership or your mobile phone bill.

A standing order is set up by customers. They choose the amount and frequency, and can change or cancel it without notifying you. In contrast, you have full control over the payments you take by Direct Debit. You decide how much and how often you collect from customers.

Cancelling a direct debit online

It may take up to 24 hours for the balance of your account to be adjusted.