What you need to know about debit orders

Between work, your family and everyday life, remembering to pay the monthly bills can at times fall by the wayside. A debit order from your bank may just be the solution to ensure that your repayments are paid on time, every time.

What is a debit order?

A debit order is a commitment between you and a third party to take an agreed amount of money out of your bank account every month to pay for a service or to repay a loan. Providing you with payment history, debit orders make it easy to keep track of payments so you’ll know exactly what is going in-and-out of your account always, further helping you stick to your budget.

As you decide on the date your debit order will go off, it can ensure that your financial priorities are paid first and soon after payday.

What happens when you don’t have sufficient funds?

Not being able to pay your debit order because of low funds will result in a penalty fee, as well as a late-payment fee and added interest to your account. Bounced debit orders can reflect negatively on your credit profile, and affect your credit history in future.

How can I cancel a debit order?

To cancel a debit order, you must contact the party you have the signed contracted agreement with, as only they can cancel the debit order, not your bank. It’s then up to you to ensure that the instructions are carried out.

Do debit orders incur a bank fee?

Banks may charge a debit order fee, which differs for each bank but includes the opening and maintaining of your account. These fees can be found in your bank’s pricing guide.

A debit order is a simple and reliable answer if you need help keeping up-to-date with your monthly repayments and better managing your budget.