What are the disadvantages of Direct Debit?
Although there are more advantages than disadvantages to using direct debit services, this does not mean there aren’t things to watch out for! Before considering this program/service, it is good to weigh both the advantages and the disadvantages.
Mortgage House experts recommend jotting down a list to review and compare both aspects of the service. A direct debit payment occurs when a user authorises a company to take funds and payments from an account or a credit card to pay for a service or product.
A disadvantage to using direct debit as a form of payment is that since it is a contract, the money will come out of your account regardless if you have all of the funds. This can cause huge issues, including leaving the user in a negative balance. Many banks charge negative balance fees.
Another disadvantage to consider before enrolling in a direct debit payment system is that they are not easy to cancel! Once you give authorisation to a company, it can be hard to take the authorisation away. Always read the fine print and the terms and services. Even when you cancel service and the direct debit payment, the charge can still go through since the request takes time to process.
Direct Debit Disadvantages Conclusion
Overall, a direct debit payment system is convenient, easy to use, and perfect for recurring charges. While this is the case, there are disadvantages to using the service. It is not a payment system built for everyone. Mortgage House experts are happy to assist in finding out if a direct debit payment service is good for you.