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Direct Debits

What is a Direct Debit?

A Direct Debit lets a company take money on set dates. Here’s how it works.

On this page
How do Direct Debits work?
Direct Debit pros and cons
How to set up a Direct Debit
How to cancel a Direct Debit
Direct Debits vs standing orders
FAQs

How do Direct Debits work?

With a Direct Debit, you give businesses permission to automatically collect bill payments at set times. They’re then taken from your account on specific dates.

Direct Debit payments can stay the same if your bill is for a fixed amount. Think of a streaming subscription or monthly phone contract. But they may change if your spending goes up or down. For example, like electricity, gas and water bills.

Either way, the company should tell you the amount and date for each payment upfront, so you know what to expect. This could be via a bill, text or email.

What can a Direct Debit pay for?

Direct Debits can cover lots of services and bill types. Here are just a few examples:

  • Monthly utility bills.
  • Gym memberships.
  • Council tax bills.
  • TV streaming services.
  • Donations to charity.
  • Insurance payments.

Direct Debit pros and cons

Pros

  • Automatic payments. You’ll only need to set up a Direct Debit once. The company and your bank should take care of the rest.
  • Peace of mind. With Direct Debits, there’s no need to remember payments each month. This might reduce the risks of missed payments and late fees.
  • Protection if things go wrong. Under the Direct Debit Guarantee, you’ll get a full and immediate refund should a business make a mistake.

Cons

  • The risk of forgetting debit payments. With money leaving your account automatically, you might lose track of certain payments. For example, a subscription you no longer use or need.
  • Fees. You could be charged a fee or go overdrawn if there’s not enough cash in your account to cover payments.

How to set up a Direct Debit

What you’ll need to get started

To set up a new Direct Debit with a company, you’ll need to fill in a form online, by post or over the phone. This is called a Direct Debit mandate or instruction. The business will then contact your bank to get things moving.

You’ll need to provide your full name, home address, account number and sort code. Plus, the name and address of your bank. You might also be given a choice of payment dates.

How long does a Direct Debit take to set up?​

This may depend on the company you’re agreeing a Direct Debit with. It could take a few days. But it’s possible that you might have to wait 10 days or more.

Creating a new Direct Debit with NatWest

First, you’ll need to set up a Direct Debit with the business you want to pay. They’ll then get in touch with us to make things official.

The Direct Debit should appear on your account statement once the first payment has gone out.

You’ll be able to see this and other Direct Debits in Online Banking.

Register for NatWest Online Banking

How to cancel a Direct Debit

You can ask your bank to cancel a Direct Debit with a particular company. This could be online, via an app, in branch or by phone.

You may want to check your contract and confirm the cancellation with the business first. That way, you can see if there’s a notice period or an outstanding payment due.

The same goes if you’re switching from a Direct Debit to another payment method. By letting the company know, you can avoid any unwanted surprises.

Cancel a Direct Debit in the NatWest app

Here’s a quick rundown of how to cancel Direct Debit payments with the NatWest app:

  1. Head to the home screen and tap ‘Payments’.
  2. Check you’ve got the right account, then tap ‘Regular payments’ > ‘Direct Debits’.
  3. Find the relevant Direct Debit from the list.
  4. Choose the option to cancel the payment.

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Using NatWest Online Banking

Prefer to bank online? Here’s how you can cancel a Direct Debit from your browser:

  1. Once you’ve logged in, head to the main menu and click ‘Payments and transfers’.
  2. Find the ‘Direct Debits’ tab and click ‘Manage Direct Debits’.
  3. Choose the payment you want to cancel from the list.
  4. Follow the on-screen instructions to confirm the cancellation.

Log in to Online Banking

What’s the difference between a Direct Debit and standing order?

A key difference between Direct Debits and standing orders is who organises each payment.

With a Direct Debit, you give a company permission to set up regular payments from your bank account. But with a standing order, you create the payment yourself.

Meanwhile, a standing order can only pay the same amount of money each time. In contrast, Direct Debit payments can vary from month to month, depending on your bill.

FAQs on Direct Debits

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