Penalties for not paying by direct debit

[Human Writes]

Yes they have, I asked Orange about it and they referred me to a statement the Trading Standards Institute made to Watchdog when they ran their story about these charges:

 

BBC - Consumer - TV and radio - Penalty charges

 

The Trading Standards Institute offered a statement regarding this story. It said:

 

"Trading Standards officers have received a number of complaints regarding the extra charge levied by some companies on consumers who pay other than by direct debit.

"These charges are lawful. The Price Indications (Method of Payment) Regulations 1991 allow differential pricing provided the indication of the higher price is expressed clearly, unambiguously, and that it's easily identifiable by a consumer as applying to the goods, services, accommodation or facilities concerned, and given prominently and legibly.

[buzby]

However, it is worth noting that the Irish Government has enacted legislation PREVENTING firms from charging differing amounts depending on the method of payment used. Which makes you think, if the Irish can see that it is unfair and have actually done something about it, our TS should be campaigning for a similar outcome, not simply saying 'it's legal', and leaving it at that.

[jaxads]

This may be covered elsewhere, but another company charging £3-£4 per month if you don't pay by DD is SKY TV.

[Milo19]

So we can't argue this point then. They are charging us for paying a bill on time, and its LEGAL!?

[kennyparkroad]

it appears there is nothing we can do.

[buzby]

Why not turn it on its head? It is not ILLEGAL...yet (but should be) - we just need to campaign for it.

[Mark_Blackpool]

Yes they have, I asked Orange about it and they referred me to a statement the Trading Standards Institute made to Watchdog when they ran their story about these charges:

 

BBC - Consumer - TV and radio - Penalty charges

 

The Trading Standards Institute offered a statement regarding this story. It said:

 

"Trading Standards officers have received a number of complaints regarding the extra charge levied by some companies on consumers who pay other than by direct debit.

 

"These charges are lawful. The Price Indications (Method of Payment) Regulations 1991 allow differential pricing provided the indication of the higher price is expressed clearly, unambiguously, and that it's easily identifiable by a consumer as applying to the goods, services, accommodation or facilities concerned, and given prominently and legibly.

 

With respect to that last paragraph: I once had an Orange mobile on a contract for years, and thanks to a spate of cock-ups with direct debit I embarked upon cancelling all direct debits and paying by BACS instead which I still do to this day.

 

They then charged a £4 'fee' and I looked closely at their website - both the service plan pages for the plan I had - and the 'general terms and conditions' and could find no mention whatsoever of any additional charge.

 

The pages clearly state the monthly cost of the plan but do not state anywhere that the price is only for about 60% of their customers who pay by direct debit (source: BACS website, 2/3 of people pay this way).

 

Therefore, I'd say this approach - quoting a price that only 60% of people will actually pay - fails the test in that last paragraph, and this is something many companies still do.

[Human Writes]

Without meaning to shoot you down in flames I had a similar thought and researched it:

 

Straight from Orange's contract terms.

Orange's Pay Monthly Terms and Conditions

1 Definitions

 

Price Guide: a list of our current Charges which is updated from time to time and is available from us upon request.

Charges: all charges for Services, as published in our periodically updated Price Guide. These include any reasonable administration charges.

6.3 payment methods

6.3.1 we reserve the right to charge an administration fee each month for payments not made by direct debit

 

 

Pay Monthly Price Guide

 

The charges also seem to be clearly referred to on several pages of Orange's Price Guide and they are also clear on my bill, I doubt it is arguable on the basis that the charges are not clear.

[buzby]

However, I still have my original Orange service contract (long before 'Pay monthly' was coined, and I have not specifically agreed to those changes. I have never had a new phone from them since 1996 and whilst they can assert I'm covered by the revised T&C's I've never been formally advised of them.

 

Of course, all we need is to follow the Irish Route where this type of charging is outlawed, then it'll fall under the UTCC remit and we'll all be happy!

[beetlejuice]

Looking for BT Late Payment Charges Forum, (can't find) so I'll HiJack here until directed.

 

Are BT allowed to charge £7.50 late payment fee is this not just like the Banks. Answers please.....

 

Beetlejuice.

 

[Milo19]

I would challenged it. Its a penalty charge.

[un1boy]

Guys I have written a strongly worded letter re charging for non-direct debit payers.

 

I will let you know what they say!

[jezza72]

A family member has had their £4.50 refunded by BT - on the grounds that he hasn't been notified, in writing, of the change in Terms & Conditions.

 

I however, have tried the same approach & had the reply:

"With regards to your e-mail, I do apologise for the inconvenience that unfortunately we would not be able to refund £4.50. However, if you set up direct debit on your account, this amount would be credited on your next bill."

 

Also, I have noticed that my business bill from BT doesn't include an additional charge for paying by cheque... why is this??

[Janet-M]

After email back and forth to BT this is their latest one .

 

FWI I pay by Standing Order and am never late paying .

Thank you for your e-mail dated xxxxx regarding payment processing fees.

 

Please accept my apologies for the delay in replying to you.

 

With regards to your e-mail, I am writing in response to your recent approach to BT about concerns relating to payment processing fees. I am also very sorry that you have had to make repeated contacts to have your concern resolved.

 

In response to your e-mail, I would like to inform you that from May 1st, we have reduced the price of monthly line rental by £1.00 and, broadband by £1.00 if you don’t pay by Direct Debit. At the same time, a separate payment processing fee of £1.50 a month is introduced. This is not a penalty charge but a separate fee for methods of payment which cost us more to process. So the net effect is only 50p a month more for anyone who just has a phone line with us, but anyone who takes broadband as well will be 50p a month better off.

 

BT's fee for non-Direct Debit payments is amongst the lowest around. For example, Virgin Media charge £5 a month. Many companies, such as Car phone Warehouse, will only accept customers who agree to pay by Direct Debit.

 

I also want to reassure you that the fee will not apply to customers on BT’s special rates for low income and vulnerable customers, such as In Contact Plus, the Light User Scheme, and Pay & Call.

 

The payment processing fee has been introduced because some methods of payment are costly to process. But it’s not just about the cost of taking the payments; following up when customers forget to pay on time does involve spending time and money.

 

By calculating the cost we apply a general policy for all payment methods that are not automated, i.e. other then Direct Debit or Monthly Payment Plan to reflect the higher risk of non-payment as well as the higher costs involved.

 

At BT, we are committed to offering our customers a wide choice of ways to pay their bills. Whilst we encourage choice of payment, it is worth pointing out that Direct Debit has benefits for customers. It saves time and is convenient. It means that your BT bill is one less thing to worry about.

 

If you choose to pay by Direct Debit, we try to give you up to ten days from the time of receiving the bill before processing the Direct Debit payment giving you plenty of time to ask questions, and we tell you on the bill when the amount will be taken from your

account. There is also a Direct Debit Guarantee which protects you and your money. If any error is made by BT or your bank or building society, you are guaranteed a full and immediate refund from your branch of the amount paid.

 

We will waive the non-Direct Debit fee if you choose to switch to Direct Debit or Monthly Payment Plan after receiving your first bill after May 1st.

 

Further, the fee is not transaction-based, as this would unfairly disadvantage those who need to pay in several small instalments. Instead the costs are averaged on a monthly/quarterly basis across all customers using non-automated methods of payment.

 

If you still decide not to pay the payment processing fee, we will apply our standard debt collection process. BT will not be changing its policy.

 

Please be assured whatever means you use to contact me, you can be confident that your concerns will be dealt with sensitively and professionally and in accordance with approved procedures

 

I trust, therefore, that the contents of this letter will go a long way in providing you with the reassurance that you understandably seek and provide you with the clarification needed. If you should have any further queries please do not hesitate to contact us again via e-mail.

 

Thank you for contacting BT, we value your association with us.

 

Yours Sincerely,

 

(name)

eContact Customer Service

 

[buzby]

Also, I have noticed that my business bill from BT doesn't include an additional charge for paying by cheque... why is this??

 

Because it doesn't apply to Business Lines - only Residential. Why? Because firms would tall them to take a hike and go elsewhere....

[jezza72]

Janet-M - I've had exactly the same email from them. I also pay on-time and found the line "If you still decide not to pay the payment processing fee, we will apply our standard debt collection process." threatening!

 

buzby - I wonder how much the line rental would be for a business line would be to my home address? I might make a few enquiries....

[buzby]

All the details are on their website. The main difference is that you get a free Classified Directory entry, and a higher priority in fault repairs - usually same day, or next-day.

[elliesnan]

well as l didn't pay the £4.50 l await their Standard Debt Collection Process with baited breath!!! Or then again l may just get on with my life lol

[elliesnan]

by the way paid my bill on 12th July have not heard a peep yet maybe Debt Collector gonna turn up on my doorstep wanting to know how l'm gonna pay this £4.50 l owe!!

[coz]

I sent numerous e mails and got the standard stuff as posted elsewhere on here. I counteracted by saying i dont care what virgin etc charge I just say it is unfair when I pay as soon as bill arrives. I then paid the bill minus the additional charge and eventually got a call from BT to discuss the charge etc and they said the £4.50 would not be added etc and this would be for ever but I expect that I may have to do the same process every 13 weeks. I just e mail and e mail as it is totally free and doesnt take time getting through call centres etc.

[Sidewinder]

Apologies - hit enter in error

[Sidewinder]

Having just received my phone bill I am angry about the £4.50 non DD charge. Interestingly though I have also received a letter from my local council trying to get me to pay my Council Tax by DD rather than online as I do at present. The letter says that it is more cost efficient for the council as DD payments only cost them 8p to collect but cash or cheque payments cost 45p (surely online debit card payments are almost as cheap as DD?).

 

How do BT equate the cost to £4.50?

[buzby]

by the way paid my bill on 12th July have not heard a peep yet maybe Debt Collector gonna turn up on my doorstep wanting to know how l'm gonna pay this £4.50 l owe!!

 

That's because it'll be shown as an underpayment oin your next bill. Since the bill wasn't paid in full, the Late Payment Charge will also be applied.

[kennyparkroad]

but hten you can reclaim the late payment charges as they are penalty charges.

[buzby]

Maybe, maybe not. However service will be disrupted - and if BB access is part of this, service removal is almost guaranteed, irrespective of whatever the underlying problem is.