Virgin Money

[russellhq]

Have a DD set-up with Virgin Money which had been running no problem for past few months. Then last month I pay off my balance and cancel the DD with my bank.

 

Then I get my statement in this month expecting to see a zero balance but notice they tried to take the DD (over a week after they received my payment to clear the balance) but it gets returned (of course, I cancelled it cos the balance was nill!) so I get slapped with a £12 returned paymet charge. I mean, are they for real?? My balance is zero, they try to take payment for a zero balance, it fails and I get charged! I promptly phone to complain but the chap on the other end kindly tells I should have cancelled the DD with them not the bank (I would have if I thought they would try to take a DD on a zero balance!), that they can't touch returned payment fees, it was in my contract so they can do it and the OFT said they could charge £12... Blah blah blah.

 

 

That is just crazy to me.

[rory32]

The OFT did not say they could charge £12. The OFT said that they would not automatically look into charges below £12 on the basis that they were unreasonable.

[russellhq]

Edit.

[rory32]

Anyway, are you planning on asking for the £12 back or just having a rant?

If you want your £12 back write to them (recorded delivery). Just because its in the t&c's doesn't make it legal, if its a penalty charge rather than a reflection of their true costs (do you really believe it costs £12 to electronically bounce a DD) then it is unlawful in common law and not enforceable.

[indebtstudent]

I wasn't aware that you could 'reques't a direct debit of zero. It makes absolutely no logical sense.

 

Returned payment - there was no payment requested how can it be returned?

 

My brain aches.

[rory32]

Exactly, so £12 would be, to coin a phrase, money for old rope.

[russellhq]

Ah, the DD was for £5! It's something like "2% of balance or £5 whatever is greater" £5 is obviuosly greater than 0 so lets try and take £5. Idiocy!

 

Thanks rory, I'm up to speed with the legislation, I'm just ranting

[Guest tlusnoc]

indebt~ I think what has happened here is that they attempted to take the original amount outstanding and not the zero balance, as the OP had only recently cleared the balance by other means. These things happen, and it ought to be resolved without any great difficulty. I suggest that the OP contacts them again in writing outlining the facts of the case.

[demon_x_slash]

If the term of your contract had expired, then they had no basis on which to attempt to take the DD in the first place. Was it the end of a contract, or did you just decide to pay off the balance in the general course of things?

[russellhq]

It was a credit card. What happened was this:

 

12 Apr - Payment received £1000

12 Apr - Balance £0

19 Apr - DD request £5

19 Apr - DD returned uppaid

19 Apr - Payment Returned Fee £12

 

So I paid of the remaining balance well before the DD was due then canceled the DD with my bank. DD day comes up and balance is 0 but they still try to take payment, stupid!

[meagain]

As far as I am aware, the whole "x% of balance or £5" requires that there is a balance outstanding. They can't demand a payment against an account where none is due.

[StudentInDebt]

I've had this happen before and it occurs because companies request direct debits 10 days before the due date, at this time you would have had an outstanding balance so the computer would have fired off a DD request. They don't appear to have a checking mechanism to ensure that if funds are received prior to the payment date the DD is amended, I'm inclined to believe that is their problem.

 

Bear in mind that Virgin Money are no other than our old friends MBNA, you can try another phone call and explain what has happened and ask them nicely if they will refund the money (you might get a more enlightened agent) or write a letter explaining that you won't be paying the £12.

[russellhq]

On their own site in the FAQ, it states:

What is my minimum payment?

 

The smallest monthly payment that you can make and still remain in compliance with your Terms and Conditions. Each month that your account has a balance, a minimum payment will be due. Please refer to your credit card Terms and Conditions for further details.

 

There was no balance, no payment was due. Will write to them to get this sorted. Will probably have to chase them next month when I will most likely get charged interest on the Fee, sigh

[digital]

Even though you paid the full balance outstanding, there wasn't any residual interest due was there? I had a similar thing happen to me when I paid off my credit card. Something to do with interest on the balance outstanding between the statement date and the date your payment hits the account. Some credit card companies changed their terms when they realised that many customers were transferring balances to zero-rated cards, and so they wanted to squeeze just a little bit more money out of them before they closed their accounts.