Standing Order Or Direct Debit?Posted on Jul 21, 2021
Standing orders and direct debits are both instructions to your bank to make payments from your account, for example to pay for gas, electricity or council tax, but do you know the difference?
A standing order is when you ask your bank to pay a fixed amount at certain intervals, perhaps weekly, monthly or annually. You can specify a final payment date or make the payment ‘until further notice’. You can cancel the payment at any time, by contacting your bank. If the amount you need to pay changes, for example because of a council tax increase, you will need to contact your bank to vary the amount.
A direct debit is when you authorise somebody else to take payments from your account. You give the other party permission to set up the payment. The amount may vary, but you must be notified in advance of the amount and the date on which the payment will be taken.
Members who don’t save through payroll deduction can set up a regular standing order from their bank account to pay money into their Penny Post saving account or to repay a loan. Contact our Customer Service Team using Nivo, email or call them on 0333 332 1461 during office hours, and they will send you a standing order form. Complete the form and return it to your bank, or if you use your bank’s online banking facility, you’ll be able to set up a standing order online.
When setting up a standing order to Penny Post it’s very important to quote your initials followed by your Penny Post membership number as the payment reference, for example CD12345. Without this reference, your funds cannot be allocated to your Penny Post account.
It’s always important to check your bank account regularly, either from monthly statements or online. If you see that an amount has been wrongly taken by direct debit, you need to contact your bank, and they will credit it back to you straight away under the direct debit guarantee.
You can cancel both standing orders and direct debits at any time by contacting your bank. You should also notify the organisation you were paying.
So now you know the difference between a Standing Order and a Direct Debit!