Recurring Payment Authority

[plowter]

Someone told me that there's something called a recurring payment authority in addition to the more usual direct debits and standing orders.

What's the difference between an RPA and a DD?

How can a customer tell which is being offered?

[CheekyChops]

"Recurring transaction

An authority to charge a transaction to a credit or charge card at regular intervals (typically monthly), granted by the cardholder to a merchant, retailer or other service provider. The term 'recurring transaction' may apply equally to one of the transactions or to the authority under which these are charged. Formerly known as a continuous authority transaction".

So basically a RPA is debited to a card and a DD is debited to a bank account.

[plowter]

Thanks for the response CC.

There was something on Watchdog about this. The jist was that some insurance companies used RPA (or some similar term) to collect premiums even after the customer ended the policy. The customer couldn't cancel the payments because he'd basically given the company an open-ended authority. It seemed the customer didn't have the same protection as with a DD.

[thorfinn]

Wouldn't touch it with a bargepole. I had such an arrangement with AOL in France and they took three month's payments before stopping the debits. The bank involved couldn't stop the payments because they said it was an arrangement between AOL and me. I never got my money back despite sending registered letters

[CheekyChops]

I agree with thorfinn to an extent, you are basically giving someone your card details so if they are a bit dodgy, the Bank generally can't help as you have effectively given the other person authority to debit your card.

At least with a direct debit there is the Direct Debit Guarantee Scheme to cover you from unauthorised debits, incorrect amounts etc.

[plowter]

That was what worried me about the RPA story.

If you complete a paper mandate you know whether it is a DD or SO. If you authorise a payment over the phone how do you know what you're agreed to? Some subscription services provide little in the way of written confirmation. With a DD at least you've got the protection of the DD Indemnity Guarantee.

[dzug]

If you are authorising payment from your credit card it's an RPA

If you are authorising payment direct from your bank account it's a DD

[EverClean]

Direct debit forms have a clear "Direct Debit Guarantee" printed on them. There is usually a part of the page for the customer to detach and keep.