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Are you a Direct Debit devotee or paper statement supporter?

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If you are reluctant to embrace the digital world, prefer to get paper copies of the household bills and want to pay them by cheque, did you know this could potentially be costing you an extra £276 a year?

Are you most like customer A – happy to pay by Direct Debit, get paperless bills and use online tariffs? Or perhaps customer B – you prefer to pay by cheque, get itemised paper bills and don’t like online tariffs.

There’s no right or wrong here, it’s entirely up to you of course, but I very was surprised to find just how different the charges for common household bills – mobile phone, broadband/phone and energy – in our scenarios ended up.

Virgin Media, for example, charges £5 a month for non-Direct Debit payments plus £1.75 for a paper bill for its broadband customers – that’s £51 a year. And that’s just the beginning; online options for energy tariffs can offer you a better rate too. The examples we looked at could mean the difference of £128 between the best online and offline energy tariff available.

Paperless bills, discounted rates

I was only too happy to do away with paper for my bank statements and mobile phone bills. The uninspiring looking envelopes tended to go unopened and, if I needed to check one, were difficult to locate in my filing system (otherwise known as my overflowing top drawer). Now it’s all handily accessible online.

I’m also happy to pay my bills by Direct Debit, as I find this the most convenient way to ensure I pay on time. Paying my council tax on time has often eluded me as this needs to be transferred every month, and has resulted in a couple of scary letters demanding full payment unless I paid up immediately.

Of course, if you have a preference you’re willing to pay out for that’s entirely up to you. It’s just worth working out exactly what that will mean for your pocket. Do you prefer to manage your finances entirely online and through automatic payments or do you get peace of mind from good old fashioned statements and bills?

Comments
Profile photo of wavechange
Member

I use numerous Direct Debit and have never had a single problem. Many years ago, I twice had a problem with my mortgage Standing Order, where the old and new amounts were debited from my account. This was dealt with very promptly by my bank.

For me, the most important use of Direct Debit is to pay off the full balance on two credit cards each month. I don’t want to risk paying interest at the rates charged on credit cards.

NatWest phased out paper statements but by then I had started to download details of transactions from their website.

Profile photo of wavechange
Member

When shredding some documents I discovered that I am still getting NatWest statements, albeit infrequently. That reflects how much attention I have paid to them now that I have up-to-date information online whenever I need it.

Profile photo of John Ward
Member

I do direct debits so far as I can – it ensures things get paid when we’re on holiday and I have never known a payment to go wrong in over forty-eight years [incidentally, Which? Magazine must be my longest continuous direct debit and not a single issue has gone astray despite various changes of address!]. However, I do like to receive paper bank and credit card statements every month as a useful reminder of my financial state of affairs as I tend not to look at my balances on line very often. They also have their uses when you need to prove you are who you say you are and live where you say you do. There is no charge for these at the moment but I presume it is only a matter time and then I might review the position

Profile photo of wavechange
Member

That’s a good point about proof of identity and address. As many of us move our financial affairs online and printouts are sometimes not accepted as proof, action is needed. Most of us have a bank account, so perhaps the banks could help its customers deal with this problem.

Bank statements are not usually suggested as examples of proof of identity, presumably because many would not be too keen on others seeing their financial information. A list showing current Direct Debits and how long they have been running, together with name and address, might be useful for this purpose. Rightly or wrongly, people tend to stay with their banks longer than utility companies.

Profile photo of rarrar
Member

Had to dig out a paper copy of a bank statement/utility bill as proof of address for my Bus Pass today!
Funny how banks/building societies can check ID electronically online when opening an account but public bodies still need the old 1 document from List A and 1 from List B .

Profile photo of wavechange
Member

What I don’t understand is the lack of consistency. Sometimes a printout of an online statement is acceptable proof, but not always. Photos are a problem for me because I have an old fashioned driving licence and my passport has expired. I wonder if my bus pass would be acceptable. 🙂

West Brom Building Society does not seem to know about electronic ID checking, rarrar.

Profile photo of rarrar
Member

West Brom BS – interesting I had a fixed rate savings account a few years ago with them – opened without needing to provide any ID documentation.
When I got my photo driving licence they asked for permission to get the photo from the Passport Office – now that is what I call good joined up use of existing resources.

Profile photo of NFH
Member

You’re bundling direct debit together with online billing; the two don’t go together.

I hate receiving paperwork in the post, which just piles up on my desk and requires my attention in bulk when I’ve been away from home. I therefore use online billing for everything whenever possible. I get very annoyed when companies unnecessarily send me paper correspondence, which inconveniences me and is harmful to the environment.

I oppose any compulsion (through charges) to pay by direct debit. It gives me no control over what goes out of my account until after the event, and only if I happen to notice an error in time. I’ve had plenty of problems with companies taking the wrong amount or on the wrong date, and I avoid this troublesome payment method whenever possible. My first choice is to pay by continuous payment authority to my credit card so that I receive airmiles, points or cashback. Failing that (for example if there is a surcharge for credit card payments), I pay by bank transfer.

Anyone who still chooses to pay by cheque or receive paper bills should pay the full costs of doing so. Others shouldn’t have to subsidise these wasteful practices.

Member
richard says:
29 August 2013

I have always preferred monthly paper bills ever since Midland bank only updated bills every three months and I got into serous arrears – I changed my bank to first direct – but now First Direct are changing their charges and conditions completely in THEIR favour so I will be considering seriously my options.- any recommendations???

Member
Figgerty says:
29 August 2013

I pay all my bills by direct debit, even my TV licence. It is so liberating not to have to think about paying the bills by the due date. I still receive paper bank statements, credit card statement and my energy bills as I don’t have a working printer. I do not pay extra for having paper bills so why put up with paper jams so I can print my own.

Profile photo of John Ward
Member

Yes, the whole world assumes we all have state-of-the-art printing machines at home and can run off their badly laid-out and graphically-overloaded billy-doos. They can then crow about how much they’ve down-sized their carbon footprint – by exporting it to us, of course, where the waste and inefficiency of local printing are magnified. “Don’t worry,” they say, “you can always look at it on line and it’s stored forever in The Cloud”. . . . They cannot be Cirrus!

Profile photo of banjo
Member

I use DD most of the time but I absolutely refuse to let my gas and electric suppliers invent levels of direct debit payment which essentially leaves them permanently owing me money unless I claim it back every month.

Profile photo of VynorHill
Member

Call me old fashioned, but the less the personal financial detail on my computer, the happier I feel. If it’s not there, it can’t be hacked. I use direct debits for most regular payments but also regularly check paper bank and credit card statements, sometimes referring back to check for policy price increases among other things. I wouldn’t want these statements lingering on my computer, however secure they claim to be.

Ps. It seems as though we have a spell checker on here at last, if so, well done Patrick!!

Member

I like paper bills

My working day is on a PC I do not wish to log on at home.

To levy for paper bills is NOT socially inclusive – we do not all have the internet or printers.

Customer choice?

Profile photo of tbwtg
Member

I prefer paper for an audit trail, and to guard against minor cognitive impairment through ageing, also against IT insecurity. I also hate the idea of variable direct debits – do you trust energy companies to deal fairly with you, and have you ever tried to get a bank or a utility company to adjust an incorrect transaction through their call centres? I think it’s highly discriminatory of companies to charge some people extra for processing payments made by post, or made without direct debits. Certainly, I think the extra charges should be closely regulated and compared to those levied by similar businesses, rather than just allowing the utility, eg BT, to charge what it likes.

Profile photo of lessismore
Member

I’m happy to pay for some things by Direct Debit – in particular the minimum payments on credit card bills so that I don’t get into trouble for missing a date.

I object to what appears to be bullying (not persuasion) to do things online. Not everyone can use their PC at work for personal use and I wouldn’t want to have stuff on there anyway. Use of a PC outside work is random and doesn’t have the IT support that you do get at work.

I particularly hate the way that my 95 yr old father-in-law is constantly being told in letters to look at a bank or another company’s website. He doesn’t have a computer and he isn’t going to get one now. He isn’t going to look online. Why should he have to? Somebody needs to bang these IT nerds’ heads together, together with those of the people who make such ridiculous short-sighted and disenfranchising decisions.

As others, perhaps not as old get more used to and competent and confident with the technology, I expect more will be done online but push it too hard and we will tell you to **** off in no uncertain terms.

Profile photo of lessismore
Member

I’m sure it is lovely to go paperless and that will be easy if you already have a decent enough income to not be getting into debt when all your bills go out. A lot of people live much closer to the breadline.

I do wonder if those of you who have gone paperless check your bills as often as you should. Life is like a balloon – squash the fraud in one area and it will just explode or implode somewhere else. (And I suspect a lot of companies eg banks aren’t going to do anything about it/or make anything public because of the bad publicity.)

I didn’t have the internet and BT insisted they needed to deal with me by email. Durr. I was dealing with them because I wanted the internet in order to have an email. Communication companies really really could do a lot lot better in communicating.

Profile photo of lessismore
Member

Why don’t you pay your Council Tax by Direct Debit? Or Standing Order? Funny that I consider it an important one to remember and so have paid it by Standing Order and now Direct Debit for years.
I’ve less inclination to pay the manipulative and often not satisfactory communication companies large amounts of money. They just hope you’ll set it up and forget.

Profile photo of drowatt
Member

On the whole I like electronic billing but there is a danger that unless I specifically don’t need to look at something I won’t. I’d prefer a bill to be e-mailed to me rather than a link to log in as I’m more likely to sneak a peak.
Electronic billing is fine when it works. I’ve been unable to access my T-Mobile mobile broadband bills for some time due to a fault at T-Mobile. The charge to have them sent to me by paper is apparently being waived but I’m having to pay for the calls to sort it out (not having a T-Mobile phone). Just got the latest set of paper reprints to check why a spurious amount has been taken recently and right under the suspect amount it says “Please see your electronic billing files for details’ Agggghhhh!!! 34 mins on the phone later and I’m still none the wiser as to why I’ve been overcharged but I’m guessing they have charged me for the previous set of paper bills which where mean’t to be free!! Oh well off to adjudication next! I can’t see how a paper bill can refer someone back to the electronic version though! Nonsense!

Profile photo of Roseanne
Member

I think notification prior to taking the payment should become a compulsory part of direct debit payments. I have been caught out on 2 annual direct debits, where I had forgotten the date of renewal and found myself having paid for something I was no longer using or wanting to use. I therefore, had to pay a year’s subscription and had no chance of recovering the payment.