How do I Cancel a Direct Debit?

Using a direct debit is a great way to make sure monthly bills are settled in a timely manner. By arranging to have the payment debited from the checking or other bank account, there is no need to remit payments by mail or manage the debt in some other manner. From time to time, there may be a need to cancel a direct debit as the consumer makes changes in business relationships, changes banks, or in some other manner reorders his or her finances. Fortunately, this can usually be accomplished by notifying the creditor or service provider in advance while also notifying the bank of the desire to no longer allow the direct debit to be processed.

After determining to cancel a direct debit, the first step is to notify the creditor or provider that you wish to opt out of the direct debit transaction. This can sometimes be accomplished with a face to face visit, if the creditor is based in a nearby area. At other times, preparing a formal letter that is delivered to the creditor will be necessary. The letter should include all relevant information needed to identify the right account and cancel a direct debt. Information such as your name as it appears on the vendor account, mailing address, and the bank account information associated with the direct debit will often be required.

Along with visiting the creditor in person or mailing a formal request to cancel a direct debit, it may be possible to initiate the change online. If the creditor or supplier provides online access to the account. You should be able to log into that account and make changes to the payment process currently in place. Keep in mind that with all these methods, there may be a period of time required to process the update to your payment preferences. When this is the case, there is the chance that one more direct debit will be processed even after you submit the change.

Once the creditor or supplier is notified that you wish to cancel a direct debit, notify your bank of the cancellation. Provide a copy of your letter to the supplier or possibly a hard copy of the confirmation number received when the direct debit was canceled online. Depending on the banking laws that apply in your jurisdiction, this may be sufficient for the bank to disallow any additional direct debits to occur on your account.

Should you be a victim of identity theft and find that unauthorized debits are being made on the account, work with your bank to close that account and transfer your funds to a new one. The bank can also help initiate an investigation to track down the origin of the fraudulent activity by reporting the unauthorized debits to law enforcement. This approach may also be necessary if a creditor takes an unusually long period of time to process your request to cancel a direct debit, since that debit authorization will not automatically transfer to the new account without your consent.