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Rank 1: Guest
Posts: 3
Registered: ‎01-09-2013
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Direct Debit Charge

I received a message several days ago with this message

 

Why not set up a direct debit to pay your bill & save money? There's a £3.53 a month charge if you don't pay by direct debit. We'll be adding this fee 30 days from today, so you have time to change your payment method to avoid this fee on future bills. Find out more at www. vodafone. co. uk/nonddfee1310

 

However, I believe this is against the The Consumer Rights (Payment Surcharges) Regulations 2012 which states. 

 

Excessive charges prohibited

4.  A trader must not charge consumers, in respect of the use of a given means of payment, fees that exceed the cost borne by the trader for the use of that means. 

 

Clearly, the so called £3.53 a month charge for non direct debit users are in contrast with this law. What is Vodafone trying to do? At any rate, I will be reporting this incident to Trading Standards. 

 

 

 

 

 

 

Message 1 of 200 (6,299 Views)
Rank 48: Master II
Posts: 11,619
Registered: ‎01-01-2009

Re: Direct Debit Charge

All networks charge customers who choose not to pay by direct debit. In fact lots of utility and other companies make the same charge. It isn't illegal and trading standards will not be interested.

The law you are referring to involves credit card fees and that is a totally different issue.

Jeffkinn_Sig.png

Message 2 of 200 (6,292 Views)
Rank 11: Helper V
Posts: 161
Registered: ‎05-02-2013

Re: Direct Debit Charge

Whilst we all have these payment fees, when you do not pay by direct debit, its reasonable for a company to charge a nominal fee for producing the bill and sending this to you.

 

Even if you pay before the bill due date via card the fee is still applicable.

 

Should be thankful it's less than £4, take a look around as what other companies charge.

 

 

Message 3 of 200 (6,266 Views)
Rank 1: Guest
Posts: 3
Registered: ‎15-09-2013

Re: Direct Debit Charge

I am disgusted that you are charging people if they do not wish to set up a direct debit with you.  Who do you think you are.  I was always under the impression that we have freedom of choice but clearly not, when you are forced to pay a charge.  I disagree the statement below not every company choose's to charge their customers a charge for not using a DD.  I have had some bad incidents of being overcharged, DD not being taken, or too many payments being taken.  I do not use DD for these reasons and see no good reason why I should be pressured into paying it or setting up a direct debit.  I for one will be looking for another provider at the end of my contract!!!!

Very annoyed!!!!:robotmad:

Message 4 of 200 (6,071 Views)
Rank 1: Guest
Posts: 3
Registered: ‎15-09-2013

Re: Direct Debit Charge

One more point to be made also I do not have paper bills!!, I cant not believe it costs the computer £3.53 to send an email!!!

Message 5 of 200 (6,070 Views)
Rank 48: Master II
Posts: 11,619
Registered: ‎01-01-2009

Re: Direct Debit Charge

[ Edited ]

Good luck finding a network that doesn't charge extra for paper bills or for non direct debit payments. I've just checked Virgin Mobile, a leading virtual network, and they insist on DD - there is no other option.

Jeffkinn_Sig.png

Message 6 of 200 (6,050 Views)
Rank 1: Guest
Posts: 1
Registered: ‎17-09-2013

Re: Direct Debit Charge

i pay my bill online for my bills and can not set up a direct debit with my bank account. i will not be paying the extra charge on my bill and as soon as my contract is over i will be changing providers and going on PAYG!! it isnt right to charge people for this if they dont pay by direct debiT, I started paying online so i wouldnt have any charges on my bill.

 

Message 7 of 200 (5,902 Views)
Rank 50: Grand Master
Posts: 15,151
Registered: ‎13-10-2009

Re: Direct Debit Charge

Well - as keeps getting said over and over, Vodafone are bringing their charges in line with every other mobile phone provider some of whom only allow you to pay by direct debit.  Utility companies are another example of where you will be charged for not paying by direct debit.  It is not uncommon for places to expect you to pay by direct debit and charge you when you do not.

 

If you do not pay the extra charge, this will show up as a default on your credit file and it will remain there for 6 years and mess up your ability to get credit. Worst case scenario your number will be suspended, the debt will be handed over to a debt collection agency and they will pay you a visit in order to collect the debt.

 

I am also curious as to why you can't set up a direct debit - is there perhaps a specific restricition on your account? Perhaps you can have your bank account changed in order to allow you to pay by direct debit.


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:smileywink:

Message 8 of 200 (5,892 Views)
NFH
Rank 4: Established Poster
Posts: 77
Registered: ‎03-11-2012

Re: Direct Debit Charge


jeffkinn wrote:
All networks charge customers who choose not to pay by direct debit. In fact lots of utility and other companies make the same charge. It isn't illegal and trading standards will not be interested.

The law you are referring to involves credit card fees and that is a totally different issue.

It is illegal as it blatantly breaches the Consumer Rights (Payment Surcharges) Regulations 2012. This legislation cover all payment methods on contracts started since 6th April 2013. Given that you claim incorrectly that the legislation only covers credit card fees, you clearly haven't reead the legislation; I suggest that you do so. Furthermore BIS's guidance on the legislation gives many examples, including direct debit price differentials. Ofcom's guidance (see sections 6 to 8) further clarifies that any surcharges "should reflect direct costs only. They should only include the company's extra costs of collecting normal payments and not, for example, the cost of bad debts".

 

It is particularly unreasonable and unlawful for Vodafone to surcharge customers to pay by bank transfer. I am sure that Vodafone pays nothing to receive bank transfers from within the UK into its account. I am taking the example of Barclays' charges for businesses, given that Vodafone banks with Barclays. Barclays has two options:

  • Mixed Payments Plan - 35p per electronic payment in or out
  • e-Payments Plan - free for electronic payments in or out

Given Vodafone's very large size, it will have negotiated a deal much more favourable than what is available to small and medium sized businesses. It would therefore be reasonable to assume that Vodafone pays nothing to receive incoming electronic payments into its bank account. Therefore any surcharge for payment by bank transfer is unlawful.

Message 9 of 200 (4,930 Views)
NFH
Rank 4: Established Poster
Posts: 77
Registered: ‎03-11-2012

Re: Direct Debit Charge


hmmmketchup wrote:

Whilst we all have these payment fees, when you do not pay by direct debit, its reasonable for a company to charge a nominal fee for producing the bill and sending this to you.

 


This fee is not about method of billing, but about method of payment; you appear to have confused the two. It is reasonable to surcharge for paper bills but it is neither reasonable nor lawful to surcharge by method of payment where one payment method costs Vodafone the same as another.

Message 10 of 200 (4,930 Views)
NFH
Rank 4: Established Poster
Posts: 77
Registered: ‎03-11-2012

Re: Direct Debit Charge


jeffkinn wrote:

Good luck finding a network that doesn't charge extra for paper bills or for non direct debit payments. I've just checked Virgin Mobile, a leading virtual network, and they insist on DD - there is no other option.


Which have found widespread flouting of the new regulations and have provided a page where you can report companies who do so. Many large companies are continuing to make these surcharges, even though they are now unlawful. The assumption that "if a large company does something then it must be lawful" is very misguided.

Message 11 of 200 (4,928 Views)
NFH
Rank 4: Established Poster
Posts: 77
Registered: ‎03-11-2012

Re: Direct Debit Charge


drey_p wrote:

Well - as keeps getting said over and over, Vodafone are bringing their charges in line with every other mobile phone provider some of whom only allow you to pay by direct debit.  Utility companies are another example of where you will be charged for not paying by direct debit.  It is not uncommon for places to expect you to pay by direct debit and charge you when you do not.


By bringing its charges into line with unlawful surcharges by other networks, Vodafone is in breach of the above regulations. It's like saying that "because everyone else on the motorway is driving at 90mph, I will do the same"; it doesn't make it lawful. When is Vodafone going to rectify this unlawful practice? The law, as well as BIS's and Ofcom's guidance, is very clear. Why has nothing yet been changed in response to this thread?

Message 12 of 200 (4,927 Views)
NFH
Rank 4: Established Poster
Posts: 77
Registered: ‎03-11-2012

Re: Direct Debit Charge

This was covered on BBC Radio 4's Money Box today (jump to 08:43). Ian Roberts, a specialist consumer finance solicitor at Pinsent Masons, explained that if a consumer has been charged these unlawful payment surcharges, they can claim them back (less the true cost to the business which will be only a few pence). Regulation 10(b) provides for this.

 

As a result of the investigations surrounding this malpractice, Vodafone unfortunately told BBC Money Box yesterday that it would no longer let anyone pay by any means other than direct debit.

Message 13 of 200 (4,604 Views)
Rank 6: Frequent Poster
Posts: 128
Registered: ‎26-05-2013

Re: Direct Debit Charge

Oh my goodness I just fell upon this thread and I am very glad indeed and many thanks to you NFH.
I posted about this recently when all of a sudden for August and September this year I too noticed that I had been charged a fine for non direct debit payments when I had not received any warning beforehand and I have not paid by direct debit for well over 3+ years and I have never been penalised with a charge throughout those years?

I post earlier that I had thoroughly read the Vodafone t&c online and it states that Vodafone may charge customers if they do not pay by direct debit. So I kind of thought I should of read more thoroughly before BUT I still felt bemused by the fact that all of a sudden I was now being charged and it doesn't make any sense, I have been with Vodafone for over 20 years, why now?

I have read all your comments with much enthusiasm and also read all the links you added... fabulous evidence that Vodafone should not be charging this fine..and for myself I don't even get a paper bill, I get a text message to say my bill is ready????? and I pay using a debit card on 191..that costs less than 50p!!!

I'vE just 1st SAR letter to reclaim unfair charges and fees and I've so many more to go but I think its time to start fighting back and I'm just beginning...
Message 14 of 200 (4,577 Views)
NFH
Rank 4: Established Poster
Posts: 77
Registered: ‎03-11-2012

Re: Direct Debit Charge


Lolli101 wrote:
I don't even get a paper bill, I get a text message to say my bill is ready????? and I pay using a debit card on 191..that costs less than 50p!!!

Do you speak to a human or do you pay by fully automated means? If you speak to a human, then as well as the ~20p bank charges that Vodafone incurs for processing a debit card payment, they also have to employ people (and make them available to answer calls), in which case a surcharge would be lawful and reasonable. If you pay by automated means, then a charge of only around 20p would be lawful.

 

Unless you're paying by credit card (which would earn you cashback, points or airmiles and would cost Vodafone around 1%), then you ought to pay by bank transfer (instructed via online banking) as this would cost Vodafone zero.

 

In any case, the payment surcharges for contract customers should be contrasted with the lack of surcharge paid by PAYG customers for top-ups. Where Vodafone does incur bank charges or the costs of employing staff to process payments, it should treat contract and PAYG customers in the same way.

Message 15 of 200 (4,568 Views)
Rank 1: Guest
Posts: 9
Registered: ‎29-10-2013

Re: Direct Debit Charge

[ Edited ]

It doesn't seem though as if they have added it anyway to the billing page on 'My Accounts' 

Message 16 of 200 (4,468 Views)
NFH
Rank 4: Established Poster
Posts: 77
Registered: ‎03-11-2012

Re: Direct Debit Charge


C_Newman13 wrote:

Where does it define that it only applies for credit charges? 


It doesn't. The Regulations apply to all means of payment. I've already coverage this above.

Message 17 of 200 (4,462 Views)
Rank 1: Guest
Posts: 9
Registered: ‎29-10-2013

Re: Direct Debit Charge

        I just had a snoop around and they only included it in the bill and didn't actually write it on the payment page which is quite sneaky and deceptive. How are they getting away with doing this? 

Message 18 of 200 (4,454 Views)
Rank 26: Tutor V
Posts: 594
Registered: ‎14-06-2010

Re: Direct Debit Charge

Hi all 

 

While i agree its a good thing that companies wont be allowed to charge more than it costs them... the reguslation quoted by NFH wont affect those in contract prior to 6th april 2013... 

this is taken direct from ofcoms website

"The Consumer Rights (Payment Surcharges) Regulations 2012 came into force on 6 April 2013 and apply to contracts entered into on or after that date."

 

so for anyone signing into a contract after that date ... great stuff..... for those of us who signed contracts before this date .... not so good

Message 19 of 200 (4,451 Views)
NFH
Rank 4: Established Poster
Posts: 77
Registered: ‎03-11-2012

Re: Direct Debit Charge


C_Newman13 wrote:

        I just had a snoop around and they only included it in the bill and didn't actually write it on the payment page which is quite sneaky and deceptive. How are they getting away with doing this? 


If you listen to BBC Radio 4's Money Box, you'll hear that Vodafone are not the only mobile networks "getting away with doing this". Three charges £4.08 to receive a bank transfer, when in fact it costs them zero.

Message 20 of 200 (4,443 Views)