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How To Cancel A Direct Debit – Everything You Need To Know

How To Cancel A Direct Debit – Everything You Need To Know

14 Jul 2022

One of the most appealing parts of spring cleaning your finances is cancelling unnecessary Direct Debit payments. Simply follow the correct cancellation procedure to avoid any potential negative consequences. If you often send money to Pakistan from abroad using direct debit payments, you might want to learn how to cancel a direct debit in the case of wrong payment. 

To cancel a Direct Debit, contact your bank, visit your local branch or access secure online banking. Direct Debit payments can be revoked, but banks require at least one business day's notice before your next payment date. 

If you're unsure how to cancel a Direct Debit, then continue reading, and you will get to know everything in steps.

What Is A Direct Debit?

A Direct Debit is a payment you make to your bank or building society. It allows the organisation you want to pay to deduct varying amounts from your account – but only if you've been given advance notice of the payments and collection dates.

Once you've agreed on those, the funds are deducted automatically. If the organisation you are paying wishes to change the amount or date of collection, they must first notify you.

In a nutshell, Direct Debit is the most straightforward and convenient method of paying your regular and irregular bills. It means you won't have to worry about missing essential payments, especially when you're on vacation, during peak seasons, or doing anything more enjoyable than thinking about bills.

Direct debit (both ACH and EFT) is a free payment method. While you may be charged a fee for your transfer, you will not be charged additional payment processing fees on an online money transfer to Pakistan.

What Is the Process for Cancelling a Direct Debit Instruction?

Cancelling a Direct Debit instruction consists of four steps. Let's get rid of the ones you don't need anymore.

Check Your Contract

Before cancelling a Direct Debit payment with your bank or building society, you should read the fine print of any contract. Breaching any contract can land you in hot water, resulting in penalties. 

Even if you're no longer utilising the service, it may make more financial sense to see out the agreement due to early cancellation fees. Your contract may specify a notice period during which you must allow the company to process any cancellation requests.

Contact Your Financial Institution

Customers can cancel or stop a Direct Debit instruction by calling, going to a branch, or using online banking. However, it's good to follow up with a written cancellation confirmation, which can be done via email.

Before the cancellation takes effect, give yourself at least one full business day. To put it another way, don't wait until the last minute to request a cancellation.

Speak With The Business Or Organisation

It is preferable to contact the firm or organisation directly to cancel the Direct Debit. You'll be able to double-check any contract, confirm when Direct Debit payments will end, and obtain everything in writing this way.

Your bank or building society will send an automated Direct Debit Amendment and Cancellation Service (ADDACS) notification to your company. When customers modify Direct Debit instructions, this ADDACS system is how payment service providers communicate with service users (businesses and organisations you send Direct Debit payments). 

Even if you don't contact them personally, this ADDACS communication will inform them that a Direct Debit to them has been discontinued.

Follow Up

Ensure that your Direct Debit cancellation takes effect and that you are not charged for future payments by checking your bank statements. Stop wasting your hard-earned cash on direct debits for items you don't require.

Remember that cancelling the Direct Debit simply prevents payments from being made to the organisation you are paying. If you continue to receive the goods or services, you will need to arrange an alternative payment method.

To cancel a Direct Debit, you must provide the following information:

  • The name of the organisation to which you are making a payment.
  • Your account number from a bank or building society.
  • The account's name(s).
  • The sort code for the branch (see your debit card or banking app).
  • Your organisation's customer reference (if known).

If you are not in a hurry and want to send money to Pakistan online without paying extra fees, you should consider using direct debit.

What Exactly Is a Direct Debit Guarantee?

The Direct Debit Guarantee provides excellent consumer protection. The Direct Debit Guarantee applies to all financial institutions that accept Direct Debit payments.

Essentially, it means that any errors made by the bank, building society, or organisation you are paying must be refunded immediately–before any investigation. If an unauthorised payment is made after you've cancelled a Direct Debit, your bank must immediately refund you. Of course, if you are refunded in error, you must repay them.

It also means that if the company or organisation wants to change any of the details of your scheduled payment, such as payment amounts or payment collection dates, they must give you ten working days' notice. 

Is Direct Debit similar to a debit card?

Direct debits and debit card payments are not the same things. A direct debit is a recurring payment that occurs automatically. If you want to pay a bill with your debit card, you'll most likely have to enter the card information each time you make a payment.

Save More Money By Setting Up Direct Debit With ACE

Direct debit is an ideal method for making regular payments. You simply set it and then forget about it. Many countries accept direct debit payments, making it easier to pay your mortgage or utility bills on an overseas property, send regular transfers to international contractors, or send money to friends and family abroad. 

And with ACE Money Transfer, you'll always get the actual mid-market exchange rate when you send money to Pakistan from the UK or any other country—which means you can save up to 6x when you send money online with ACE direct debits vs using your regular bank.

Open a free ACE Money Transfer account online to set up direct debit payments and save money on transfers anywhere.

Cancel Direct Debit Using An App 

You can cancel your direct debit by using your mobile banking app; all you have to do is:

  • Access your Mobile Banking app.
  • Choose the account for which the direct debit is set up.
  • Choose the 'Direct debits' option.
  • Choose the direct debit that you want to cancel. The direct debit details will be displayed, and the option to cancel the direct debit will appear at the bottom of this screen.

If the Direct Debit you want to cancel is not listed with your other Direct Debits, it may be a recurring card payment.

Factors To Keep In Mind When Canceling A Direct Debit

Cancelling your direct debit does not result in the termination of your contract with the merchant. If you still have a contract with a merchant and have terminated a direct debit, you must establish alternate payment arrangements with them. If you no longer need their services, you must cancel your contract with them.

If you have a direct debit from a joint account (which needs all account holders to sign or authorise), you must cancel the direct debit from all account holders. Joint account holders can do this over the phone or in person at a branch.

You, as a consumer, have the option to cancel a Direct Debit contract at any time by contacting your merchant directly or through your bank. If you ask your merchant to cancel an order, make sure to contact your bank.

You can cancel a direct debit anytime by writing or calling your bank, or using secure internet banking. Although phone or internet banking is a simple and quick process, it is usually recommended to confirm your instructions in writing, either by letter or email.

It is always preferable to notify the recipient before cancelling a payment because it streamlines your job and saves you from costs or penalties for non-payment. It is usually a good idea to add as much information as possible because it will assist your bank in processing your information and instructions more efficiently. One of the best ways to send money to Pakistan or any other country is via direct debit. 

Final Thoughts 

When a Direct Debit is cancelled, the company is notified via an ADDACS message sent by the bank. The cancellation must then be implemented within three days of receiving the ADDACS message. During this time, the customer can be contacted to discuss why they have cancelled, how they wish to proceed, and the consequences of revoking the Direct Debit.

If your Direct Debit is tied to any long-term contract, it is best to set up a new payment plan to avoid any adverse effects on your credit score and avoid any fines or penalties for non-payment.



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