25 Jun 2022

Will cancelling a direct debit affect my credit rating?

Cancelling a Direct Debit

Cancelling a direct debit is easy and painless; however, it can affect your credit rating if not done correctly. Before you fully consider and make your decision to cancel your direct debit payment, look at the contract if there is one! The number one reason that a credit rating is affected because of direct debit is that there is a violation of your contract.

For example, some merchants and payments require the entire amount to be paid. If not, this can lead to an increase in charges. Sometimes, it is best to stay using your direct debit payment instead of cancelling it.

If you do want to cancel your direct debit and the contract does not state you cannot, there will be no changes to your credit rating! Looking to cancel the direct debit? First, contact the company to let them know you want to cancel. It is likely that you will need to call as there are limited online representatives. Once you call online, also call your bank!

While it is true that direct debit payments are secure and the responsibility of the merchant, it is still good to double-check the status!

Cancelling a Direct Debit Conclusion

When cancelling a direct debit, it is normal to fear for your credit rating. However, as long as you cancel appropriately and within the terms of your contract, there should be no change to your rating! Instead, call the company and your bank to start the cancellation process.

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