A Direct Debit agreement between you and your bank allows businesses to collect money from your current accounts on certain dates, excluding weekends and bank holidays.
You can set up a Direct Debit to a make one-off payment, but they’re commonly used to manage regular or ongoing payments, such as:
Once you’ve set up a Direct Debit, the company will automatically take the money from your account on a date you choose – as long as it’s a working day.
The company will also remind you of your Direct Debit before withdrawing the money. This gives you time to make sure you have enough money in your account to cover the payment.
Direct Debits can help you manage your bills and avoid missed or late payments – giving you one less thing to worry about.
To set up Direct Debit, you’ll need to provide the company with your information. They will then set up a Direct Debit on your behalf.
The company will need to know:
You’ll need to fill in a Direct Debit instruction form that permits the company to take the money from your account. This could be online, or you may need to request a physical form from the company. You may also be able to provide your details over the phone.
The form will also include your Direct Debit reference number – a unique code to help the company identify your payments.
Once set up, the first payment will leave your account on the date you agreed and continue (each month, for example) until the Direct Debit is cancelled.
You’ll also receive a Direct Debit Guarantee. This is an assurance that if the company makes an error with your Direct Debit, your bank will refund you. The Direct Debit Guarantee also states that you can cancel your Direct Debit anytime.
After you provide your information, it typically takes between 3 and 10 days to set up a Direct Debit. This process can take up to 30 days, depending on the company.
Keep in mind – you may need to make a manual payment to your service provider while you wait for the Direct Debit to be set up, to avoid missed payments.
Direct Debits leave your account on weekdays, excluding bank holidays. If a payment falls on a weekend or bank holiday, the company will take it on the next available working day instead.
There is no set time for a Direct Debit to leave your account, but early morning debits (1am to 7am) are the most common.
Usually, the quickest way to cancel a Direct Debit altogether is through online and mobile banking, but you can also cancel by phone or in person.
You’ll need to cancel at least 2 working days before your next payment is due, or the money may still be taken from your account.
You should also let the company know before the final payment date – to make sure they end the contract.
If you just want to amend a Direct Debit, you'll need to contact the company directly.