Not upheld: Direct Debit collection timing and fairness of payment terms complaint against Barclays Bank UK PLC trading as Tesco Bank

Decision detail

Summary

Miss P complained that Tesco Bank collected her credit card Direct Debit 5 days before the payment due date when paying the full statement balance, whereas minimum payments would be collected on the due date. She felt this was unfair and placed full-balance payers at a disadvantage. Tesco Bank explained that early collection of full statement payments (which are significantly larger) provides a buffer to address any issues before the due date. The ombudsman found that the collection date was clearly communicated on monthly statements, the policy was standard and stated, and Miss P had the option to switch to manual payments. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman found that Tesco Bank's policy of collecting full statement payments 5 calendar days before the payment due date was clearly communicated on monthly statements and was a stated standard process. The ombudsman accepted Tesco Bank's rationale that early collection of larger full statement payments provides a buffer to address insufficient funds issues before the payment due date. The ombudsman noted that the Financial Ombudsman Service cannot require a business to change its policies and processes, and that Miss P had the option to switch to manual payments if she preferred to pay on a different date.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website