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Pitfalls of Automated Bill Payment

kdawson posted about 6 years ago | from the marching-through-the-hiccups dept.

The Almighty Buck 416

theodp writes "A few months ago, the NY Times' Ron Lieber extolled the virtues of allowing utilities, phone, and credit card companies to pull whatever you owe from your bank account. Big mistake. Lieber's readers fired back, telling him he was out of his mind for suggesting that they give billers unfettered access to their credit cards and bank accounts. Now Lieber goes through five of the glitches that can occur with any of the various methods of setting up automatic payments: 'You can give each biller permission to pull the full amount from your bank account. You can use the online bill system at your bank to push payments out automatically each month. Or you can charge every bill to your credit card and give only that card company permission to pull money from your bank account when the credit card bill is due. Each of these methods has its potential shortcomings ...'" What kind of payment automation do you use, and why?

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ehh (-1, Troll)

raybob (203381) | about 6 years ago | (#24816953)

FP !!!

Re:ehh (-1, Offtopic)

raybob (203381) | about 6 years ago | (#24817033)

How is a first post a troll, jackasses ? Unless... I was trolling for a first post ?!? Giggity !

Re:ehh (-1, Redundant)

Anonymous Coward | about 6 years ago | (#24817361)

FP is a troll because... it's like first place at the Special Olympics. Sure, your #1 across the finish line, but your a retarded fucking loser for thinking it means anything.

Seriously... do you have such a small dick that you honestly think being able to type fp and click submit means anything?

And then you come back 20 minutes later to cry about it? Not only are you a special Olympics failure, but your an emo bitch who has to cry that his accomplishment isn't appreciated?

Last but not least... fuck you and have a nice day.

D'uh (4, Funny)

The Ancients (626689) | about 6 years ago | (#24816963)

There's plenty of credit card details that can be bought for $20 on the internet. Problem solved!

Re:D'uh (1)

Z00L00K (682162) | about 6 years ago | (#24817195)

As long as I don't have to pay with checks I'm good. I don't have checks and don't expect to need any either.

Anyway - it depends on who I'm paying, but the insurance is paid by permission monthly. A fixed sum that always goes the same way so it's no big problem.

Other bills are paid through the bank service internet page into their account. Signed with a challenge/response token to make sure that the recipient and amount are right.

It is simple (2, Funny)

Anonymous Coward | about 6 years ago | (#24816965)

I pay all of my bills in Linden Dollars.

Well.. (2, Funny)

Entropy98 (1340659) | about 6 years ago | (#24816969)

As long as it not AOL or Paypal what is there to worry about?
--
Find My IP Address [ipfinding.com]

I use Paytrust (5, Informative)

ptbarnett (159784) | about 6 years ago | (#24816975)

http://www.paytrust.com/ [paytrust.com]

Most of my bills are transmitted electronically. The rest are mailed to Paytrust's P.O. box, and they post the scanned PDF for my review.

I set the payment rules via their website: pay full amount, pay full amount up to [limit], pay specified amount. Or I can just wait for the notification in my email and pay it myself with a few bill clicks.

Re:I use Paytrust (3, Insightful)

Apple Acolyte (517892) | about 6 years ago | (#24816989)

I haven't heard of paytrust before, but is it really safe to have a third party looking at your bills?

Re:I use Paytrust (3, Interesting)

ptbarnett (159784) | about 6 years ago | (#24817043)

I haven't heard of paytrust before, but is it really safe to have a third party looking at your bills?

Depends on what you are worried about. There's nothing in any of the bills I send to Paytrust that would bother me if it became public knowledge. If someone wants to alert Al Gore because I used too much electricity last month, I'd love the opportunity to laugh and slam my door in his face.

I pay my credit card with a direct transfer (my checking account and credit card are at same bank), so they don't get that statement. The cool thing about Paytrust is that you can send ANY bill to them, including ones that don't offer automatic payment. And if you want to change the account that is used to pay the bill, you only have to make a change in one place.

Just use cash (1)

wisty (1335733) | about 6 years ago | (#24817103)

Don't trust them. Don't trust anyone. Just send your payments over in cold hard cash. Circulated quarters are best.

Re:I use Paytrust (1)

Skal Tura (595728) | about 6 years ago | (#24817187)

http://www.paytrust.com/ [paytrust.com]

Most of my bills are transmitted electronically. The rest are mailed to Paytrust's P.O. box, and they post the scanned PDF for my review.

I set the payment rules via their website: pay full amount, pay full amount up to [limit], pay specified amount. Or I can just wait for the notification in my email and pay it myself with a few bill clicks.

That's rather an interesting concept for an service. Just as i were thinking reading the summary that why do not banks have "pay upto X amount" kind of limitations, you come up with a comment about paytrust :D

Unfortunately, i think there's no such service in Finland

More Paytrust info - LOTS OF DETAILS (5, Informative)

Anonymous Coward | about 6 years ago | (#24817411)

I was an early adopter with Paytust (back when they were PayMybills.com). They were bought out by Intuit. I'm still with them today. Here's why:

BORING: Yes, you can do the simple bill payments that you can do with many bank accounts now. You can send a check to a name or an address for a certain amount, perhaps against a specific account number. They'll put everything together and mail out the payment for you.

EXCITING: What makes this service shine is bill RECEIVING. You got bills that come to your house? You change your billing address. You give them a special PO BOX # that is provided with your account. Paytrust will scan the bill in as PDF format. They'll pre-populate the bill's data into your account, matching it with one of your known billers, and doing the data entry for the minimum amount due, the total amount due, and the due date.

In my case, I still micromanage. I get an email from them saying that some new bills came in (and provides the basic details of the bill that I just mentioned). So, most of the heavy lifting is done for you so that when it comes time to pay the bill, it is just 'click a checkbox', 'click a button', and 'click a button to confirm'.

You can set up autopayment rules (which I haven't done) to auto-pay a bill if it is under a certain amount, or to pay off the full balance, or pay against the minimum due, or whatever. I know that they've got some flexibility there.

They're got some added protection for detecting duplicate bills (more than 1 bill in a billing cycle), and also, more importantly, the 'missing bill', to let you know that normally you receive a monthly bill from a company, but nothing ever came.

ORGANIZING: If you read between the lines to see the net effect of all of this, here it is. Basically, I log onto their website. The main screen tells me the bills that I have yet to pay. The bills that I have paid will drop of of that screen. So I instantly know, at any given time, what has or hasn't been paid. Which is so useful to me, I haven't had a late payment on anything since I adopted their service. That has contributed to my credit score reaching a very nice level (and my avoiding late penalties, and punitive APR increases).

RESEARCH/HISTORY: A scan (again, PDF) is kept online for a year (after which, they offer archival CDROMS. So you can go back and, say, figure out when a charge was put on, or when you interest rate changed, or how much electricity you used a year ago. Totally worth its weight in gold in doing the kind of research that only the most organized freak could do before.

You've also got a good summary screen of every payment you've ever made through the system, so you can find out, say, what were the last 10 payments I made to Chase?

Small unexpected but appreciated service: if my credit card company sends me a credit card, or I get a really weird non-bill letter (that isn't spam), they'll forward it to my real address.

So, I hope I don't come across as a shill for these guys, but I'm absolutely a great fan. Their service has really saved me so much time, money, and frustration over the years. One of the best kept secrets of the web, IMHO.

Re:More Paytrust info - LOTS OF DETAILS (1)

ptbarnett (159784) | about 6 years ago | (#24817523)

I was an early adopter with Paytust (back when they were PayMybills.com). They were bought out by Intuit.

A clarification: PayMyBills.com was originally a separate company. They were acquired by Paytrust.com in September 2000.

I started with PayMyBills. I abandoned them and switched to Paytrust after PayMyBills got behind on processing incoming bills and were making late payments.

Intuit acquired Paytrust in late 2004.

I pay online (4, Interesting)

fishyfool (854019) | about 6 years ago | (#24816977)

But none of them are automatic withdrawals. Every month I take the time to go to the website of the biller in question, and tell them exactly what I want to pay. That way if there's a mistake, It's my mistake. I also have a specific checking account I use for online payments. I only transfer enough to pay what I said I'd pay and not a dime more. Just as a layer of insulation between my checking account and my bill account.

Re:I pay online (5, Insightful)

Daengbo (523424) | about 6 years ago | (#24817037)

I use the "get my ass to the post office method. I'd pay online, but Korea uses an ActiveX plugin instead of SSL. Even if I had ActiveX, there's no way I'd do that.

Re:I pay online (1)

MichaelSmith (789609) | about 6 years ago | (#24817317)

Yes I noticed that ActiveX is rather popular in South Korea. At one place where I worked there the internet gateway would not give you any external pages if you had a USB drive connected to the workstation. The weird thing was that people had worked with this system for years without finding that "feature", until I asked them to download a file for me.

Re:I pay online (3, Interesting)

Daengbo (523424) | about 6 years ago | (#24817527)

I've seen seven non-Windows machines in four years in this country. They were all owned by foreigners. Four belonged to me.

Likewise... (4, Informative)

Hamster Lover (558288) | about 6 years ago | (#24817107)

I live in Canada and pay all of my bills through my bank's web site. As much as people like to rail about the lack of competition in Canada due to the fact that there are only five chartered banks for the entire country (other than credit unions, but they are provincially regulated), all five of the chartered banks offer sophisticated on-line banking (some more sophisticated than others). Hell, I even paid my property tax to the City of Calgary on-line. There is no futzing around with the biller in question and arranging electronic payments, you simply add them to your payee list on your bank's website.

Now, I could set up automatic bill payments, but I had a bad experience with the Royal Bank and a student loan; that isn't going to happen again.

Firewalls (4, Interesting)

Detritus (11846) | about 6 years ago | (#24817117)

You might want to talk to your bank about their policy on overdrafts. I found out, the hard way, that when my checking account had insufficient funds to cover a check I had written, they just took the money from another account I had with the bank. They had never asked me for permission to do that.

The cause of the problem was a data entry error by the person who reads the amount of the check and prints it on the check with a MICR printer. They got the numbers right but moved the decimal point one place to the right. From there on, everything operated on automatic pilot, with no human intervention until I received my bank statement and spotted the problem. The bank's attitude was that the most efficient way of doing business was to automate all processing and decision-making, fixing any problems after the fact, if a customer complained. I closed all my accounts with that bank, which is now part of Bank of America.

Re:Firewalls (5, Interesting)

Atlantis-Rising (857278) | about 6 years ago | (#24817423)

The best way to deal with these policies, I have found, is to issue a written direction to the bank and hand it to your manager as well as mailing it to the bank's legal services division.

I have, for example, a written direction on file with my bank that they are to refuse any charges that would overdraft my account, regardless of whether they are preauthorized or not.

If the bank fails to uphold my explicit written instructions, they become responsible for the results.

Re:I pay online (0)

Anonymous Coward | about 6 years ago | (#24817393)

Same here (except for the separate checking account business). I also still get paper statements for both my bills and my paycheck -- the paycheck for me, so I have a record of what should have been automatically deposited into my account, and the bills for me and my roommates (I pay the bills and they reimburse me) so that we have hard copies in case of any disputes.

Re:I pay online (2, Interesting)

REALMAN (218538) | about 6 years ago | (#24817439)

I like the way my phone company's website allows me to pay the monthly bill. On the site you set up your "payment wallet" by inputting your credit or debit card details which are saved and then when it's time to pay your bill you just click "pay bill" then a confirmation box and then it's done.

This method allows me complete control versus auto payments which could cause havoc if the funds aren't in my account on the particular day an auto account would be set to.

Re:I pay online (1)

davester666 (731373) | about 6 years ago | (#24817485)

Not with the idiots at Roger's Communications here in Canada. They are SO stupid, they can't even get their web site to accept payments. Sure, their web site supports logging in via https, and you can enter how much you'd like to pay and your credit card info, and you can verify that you typed everything in. You even get a "Thanks for your payment." confirmation page.

Except you haven't actually paid. Their system doesn't log (at least, according to their CSR's) that I logged in, let alone even attempted a payment. And fortunately this silent failure doesn't actually make a charge against my charge. But it does result (if you don't call Roger's and find out that you haven't paid) in a late fee getting added to your bill, and a huge hassle to get them to remove the late payment (as there is no record that you even tried to pay).

It's been 4 months and counting. And their CSR's don't accept complaints about the web site because (and this is most bizarre), Roger's web site IT department ignores complaints made through their CSR's. I guess IT thinks the CSR's lies to them, just to give them busy-work.

Unfortunately, all the wireless carriers here in Canada are pretty much equally bad, so there's nobody worth switching to.

I was even phoned up by some Roger's agent, made under the guise of getting customer feedback, and I repeated both that their web site doesn't work and that they were just blowing off my complaining about it, but this person also didn't even seem to take the time to note down these complaints, as he didn't seem to be taking the time to make notes, and after a few questions, started trying to get me to switch my home phone over to their VOIP service (and why would I trust their VOIP service if they can't even get their web site to work?).

I don't. (5, Insightful)

Leptok (1096623) | about 6 years ago | (#24816979)

End of story. Why give them the access when it takes 10 minutes to simply do it myself?

Re:I don't. (2, Informative)

Hognoxious (631665) | about 6 years ago | (#24817005)

Why give them the access when it takes 10 minutes to simply do it myself?

Because you'll forget and get stung with interest and/or penalty fees?

Re:I don't. (1)

wellingj (1030460) | about 6 years ago | (#24817223)

Safety vs. Security?

Re:I don't. (3, Insightful)

Dionysus (12737) | about 6 years ago | (#24817549)

Because you'll forget and get stung with interest and/or penalty fees?

Which is why I set up payment the same day I get the bill. Basically, I get online notification (usually email) that a bill is due. I log into my bank and set up the payment with the payment happening on the due date. Then forget about it.

With email notification, I don't delete the email until I set up the payment.

I don't. use a calendar. (0)

Anonymous Coward | about 6 years ago | (#24817557)

Write the due date on the calendar. Just make certain it really is the due date. CC companies like to play this game. Also most financial programs will do reminders as well as some payees with an e-mail. Last why can't your pc call their pc and do the grunt work?

Re:I don't. (4, Informative)

Bazman (4849) | about 6 years ago | (#24817079)

Because it's cheaper?

Over here in the UK some companies give you a discount on your account if you pay by Direct Debit (basically an instruction to your bank to give the company whatever they ask for each month). I say 'discount', of course it's really an extra fee for doing the work yourself. If you pay online with a card you pay extra. I think for my phone company it's an extra GBP4 per quarter.

Companies over here love Direct Debits. Every bill comes with a 'why not pay by Direct Debit?' leaflet. Sadly there's no tick box for "I really don't trust you". Stories of epic fails with DDs are legion - an extra zero on the bill makes the person go overdrawn, they get a bad credit record, they lose their house, they kill all their family and so on. I exaggerate. Slightly.

Sometimes I feel I'm the only one not paying by DD, but that's what they want me to feel...

Re:I don't. (0)

Anonymous Coward | about 6 years ago | (#24817157)

I haven't heard about a single issue with direct debit yet. Common sense makes people set a limit on the transaction of say common amount +40%.

Re:I don't. (4, Informative)

blowdart (31458) | about 6 years ago | (#24817315)

Indeed; and there's a specific guarantee with Direct Debit, a phone call to the bank will get the money back immediately and it's up to the bank to chase the creditor not you. Creditors must warn you in advance if the payment amount changes, in writing, and you can cancel it at any time. Also creditors are vetted (a little) before they get the facility to allow you to setup direct debits.

The only problem I've had is with electronic DD where you don't need a signature to set it up. I've had a couple of direct debits setup for mobile phones because a cheque book was stolen a few years back; however my bank notifies me in writing every time a new direct debit or standing order is set up so I can check it (ok it's not a useful letter, they send me the reference number for the DD and the reference number for the organisation that set it up; I have to go on-line and review them where I can actually see the name of the organisation, but it's better than nothing.)

Re:I don't. (2, Informative)

Skal Tura (595728) | about 6 years ago | (#24817221)

Because it's cheaper?

Over here in the UK some companies give you a discount on your account if you pay by Direct Debit (basically an instruction to your bank to give the company whatever they ask for each month). I say 'discount', of course it's really an extra fee for doing the work yourself. If you pay online with a card you pay extra. I think for my phone company it's an extra GBP4 per quarter.

Companies over here love Direct Debits. Every bill comes with a 'why not pay by Direct Debit?' leaflet. Sadly there's no tick box for "I really don't trust you". Stories of epic fails with DDs are legion - an extra zero on the bill makes the person go overdrawn, they get a bad credit record, they lose their house, they kill all their family and so on. I exaggerate. Slightly.

Sometimes I feel I'm the only one not paying by DD, but that's what they want me to feel...

I think there should be a middle road, so that the bills get automatically posted to your bank account, and automatically paid upto X amount with an confirmation email sent automatically to your inbox.

Those exceeding the amount you could manually go and approve, or if you wish, manually approve every single one. Easier and safer.

Here in Finland, Direct Debit is rarely used infact, and nothing really happens if you cannot afford the invoice, in the past they tried 4 times on 1 day intervals, each time accrued 2.8euros extra charges.

Re:I don't. (1)

EnglishDude (580283) | about 6 years ago | (#24817271)

One of the rules of direct debit is that the company making the withdrawl *has* to tell the account holder the amount they're taking out 2 weeks beforehand (unless it's completely fixed). I once had an instruction sent to me way higher than what was supposed to be, I immediately phoned the bank and they cancelled the direct debit and I phoned the company and they sorted the error. From 13 years of using direct debit for several things (I usually have up to 15 direct debits set up), that was the only problem I had. Of course, now I've said that, all 15 direct debits will now take £1,000 each out of my account tomorrow... :)

I'm surprised the States didn't have something like Direct Debit, we've had DD for a long while now. Why is this? (I get the feeling I'll know what the responses will be...)

Re:I don't. (1)

mabhatter654 (561290) | about 6 years ago | (#24817525)

we do, but few banks have the good version you describe. Most banks or companies have some little difference in the process, when you have to keep 7 different bill schedules because they won't pick the days you ask for it gets frustrating. Also, banks hit accounts a lot harder for overdraft fees, heck they charge nearly as much now for "failover to savings" as for an overdraft. I think part of the issue is that banks all have credit cards they'd rather have you use. They're all in on it, so there's no reason to make the banking any simpler if they don't have to.

Re:I don't. (1)

jopsen (885607) | about 6 years ago | (#24817367)

In Denmark we pay by a similar system called PBS... but at the end of each month I get a list of bills and amounts that will be withdrawn from my account through PBS... So I have a few days to cancel payments... Also I think my bank can withdraw payments if necessary...

And if things go bad, I'll just showup in my bank saying you didn't tell me this could happen... Cause they really didn't tell me anything... :)

When everybody else does it, then sometimes it easier to just forget that you are smart and technologically superior, play dumb and get things done the easy way... :)

Re:I don't. (1)

Inda (580031) | about 6 years ago | (#24817615)

5% cheaper in most cases.

Once again I'm amazed at the backward nature of our friends across the water. I thought their issues with mobile phone payments was bad enough...

The thing I like about Direct Debit is I don't have to worry about bills. I can budget easily, there are no monthly shocks, I know exactly how much is coming out my account on the 24th of each month.

I know some people in the UK moan (moan in the UK? Surely not?), moan about the utility companies at year end when they are in credit. A simple phone call to adjust payments is very straight forward and if you feel you're paying too much, they'll decrease the payments without question. I once told them I wouldn't be a home weekends any more and they instantly reduced monthly payments by 25%.

I suppose if I had one moan it would be the council tax because it's paid over 10 months, not 12. Some see this as a 2-month free bonus - they are stupid.

Direct Debit Guarantee (0)

Anonymous Coward | about 6 years ago | (#24817625)

The Direct Debit Guarantee (http://www.bacs.co.uk/BACS/Consumers/Direct+Debit/Your+rights/) which guarantees immediate (i.e. same working day) refunds in the event of errors. If an error is made you can phone your bank and demand an immediate refund.

Re:I don't. (1)

dpf44 (1212006) | about 6 years ago | (#24817731)

I say 'discount', of course it's really an extra fee for doing the work yourself.

I'd have to disagree. The reason for the extra charge is because non-DD customers are a higher liability. A tiny minority of DD customers will go overdue on a payment, whereas it's considerably more likely for a non-DD customer to miss a payment. The charges for not paying by DD are typically to offset the subsequent costs to the company to pursue and collect late payments.

As for damage to your credit rating, or getting charges from your bank if you become overdrawn due to a charging error, the Direct Debit Guarantee protects you against all that.

You're notified in advance of changes to your usual charge (ie. you're invoice, which tells you when and how much money will be taken), and you can cancel the arrangement before the money is taken if you so desire. The company charging you are liable for overcharges to your account, including associated banking charges where applicable.

Even if you later discover incorrect or fraudulent charges being made to your account via DD, your bank can reverse every single direct debit payment ever charged to your account by a company, given sufficient cause.

While the system, like any other, is not perfect and open to some abuse [theregister.co.uk] , UK legislation and Banking Codes ultimately protect you.

If nothing else, it's certainly more geeky than archaic and outdated forms of payment like cheques and paper money.

Re:I don't. (1)

GoulDuck (626950) | about 6 years ago | (#24817473)

Here in Denmark, we have a system called "Betalings service" (Payment service). It's a system created by the banks to automate your bills. I think its very reliable and I have yet to experience an error. It makes sure that the bills (the monthly bills I have added to the system) gets paid on time. It also gives the companies that use the system option to put money back into an account. Once a month I get a statement that shows me what bills are going to be paid. These informations are pulled into my online bank, so I can see all stuff (loan payback etc.) going out of my account and I can always stop one payment or remove it from the automatic system via the online bank.

Like Bazman tells about in the UK, many companies gives you a rebate if you use the system.

I love the system. :)

Re:I don't. (1)

mabhatter654 (561290) | about 6 years ago | (#24817497)

not all banks offer that type of online banking. That is the trouble. Of the two Credit Unions I would use in my town (that don't rob you blind like the banks) My bank doesn't offer true online banking, and the other offers only "mail a check".

Issue's I've seen:
Some bank's "online" is merely putting thru and ACH electronic check when you suggest. Some are better than others but they almost always want to wire the money on THEIR terms so they can float the transit.

The companies that want you to give them your info vary greatly. One of my bills takes the bill out exactly on the date you say, every time. My telco wants to vary by 5 days either way, whenever they choose... that totally humps you when you expect it to come after your paychecks direct deposit in to checking.

Personally I think the banks like it to be hard, after all, most of the people paying overdraft charges and late fees on credit cards could eliminate those things if the banks evened out their systems. Personally, the banks are still making money on "floating the check" in the US and don't want the big flux of money on the first & fifteenth, they want the money spread out so they can earn interest on it for a few days.

Does this count? (-1, Redundant)

Anonymous Coward | about 6 years ago | (#24816981)

Does automated payment with an automatic and a ski mask count?

Re:Does this count? (1)

MobileTatsu-NJG (946591) | about 6 years ago | (#24817707)

"Does automated payment with an automatic and a ski mask count?"

Only if you send a robot to do it.

In New Zealand (1, Insightful)

Anonymous Coward | about 6 years ago | (#24816995)

An Automatic Payment is something where the money is pushed out of your account at your end

Direct Debit is where a company has access to your account to withdraw

Yes, companies often 'forget' to discontinue the Direct Debit when you cancel services with them. People who use this method probably also fall for Hire Purchase and Lease to Own deals too

One-Time Payment (4, Insightful)

Bardez (915334) | about 6 years ago | (#24816999)

Every time I log in to any online payable account, they neg me to set up automatic bill payments. But personally, it's worth the half-hour to an hour of my time -once a month- to fill out an online form. Why would I give anyone unfettered access to my money? What if I have some sort of emergency crop up? I have heard numerous times from co-workers how the automatic deduction will roll out way too early (three weeks ahead of schedule at one point), causing overdraft fees that are entirely the deductor's fault. If they fuck up, the corporate machine would take months if not years to settle any kind of litigation in the event that their customer service department does not agree with my claims. I'll do the one-time payments, thanks. I figure it's worth the hour to control when and where I disperse my money.

Re:One-Time Payment (1)

digitalchinky (650880) | about 6 years ago | (#24817697)

About 10 or 12 years ago when I was living in Australia I used to pay absolutely every single bill by visa debit card on line (No possibility of overdrawing, no money, no pay). Electricity, water, gas, telephone, shopping, take out, etc.

They did have a system you could set up to do it automatically back then too, though given that all of these pay on line services only took perhaps no more than 2 minutes to actually complete, I never saw the point. You could also pay by phone in much the same way, dial up the number on the bill, follow a couple of prompts, type the amount, cc number, and done.

Australia has been pretty forward thinking in terms of on line payments, at least in the early days of the internet they were, probably things have stagnated since then, I don't live there any more.

Amex takes care of it (1)

beefstu01 (520880) | about 6 years ago | (#24817001)

I can pay bills through the American Express credit card management site. I'm really not too worried, as I can always dispute charges on my credit cards- happened once and it was all sorted out in about half an hour. I also keep a low credit limit on my cards, so if there's any damage financially it's minimal.

Direct debit (5, Informative)

BorgDrone (64343) | about 6 years ago | (#24817047)

Over here (the netherlands) lots of people use direct debit. It's safe and convenient and it doesn't give anyone unlimited access to anything. If you give permission for a regular direct debit to a company you can at any time cancel this with your bank, you can also undo an automatic withdrawal (within a timeframe of 2 weeks after the withdrawal iirc), no questions asked.

Also, people rarely use creditcards here, everyone uses direct debit cards, which are secured with a PIN code. Cheques are not used any more. If you need to transfer some money to someone you usually transfer it directly from your account to theirs.

Re:Direct debit (1)

cuby (832037) | about 6 years ago | (#24817479)

Yes, that's true. This behaviour is common to almost all Europe.

I never really activated direct debit because I want to have the real perception of all the costs I have. I take 15 minutes every month to pay all the bills online, that's not much.

Moreover, back in collage I worked in a call center of a major utility when they introduced direct debit, it was a major improvement to consumers. Before that, banks had full access to the accounts and I remember some of them were CLEANED by bill mistakes. No need to highlight that this would take some weeks to correct...
When you use these type of payment, the probability of not even look to the bill is high... All sorts of things can be happening without your knowledge.

Re:Direct debit (3, Informative)

Teun (17872) | about 6 years ago | (#24817509)

I can second that, as a matter of fact in most Western European countries it's the bank that protects you against wrongful withdrawals, similar to what a credit card company can do but much cheaper.

Here in The Netherlands it's mainly the cable company UPC that gets in the news for continuing monthly withdrawals after cancellation of a contract but the banks sort these problems without cost for the individual.

Last month it was thirty years ago I got a credit card because I experienced the hard way it was a necessity for international travel. To get it (from American Express) my bank needed to mediate and I was the first person with one for this local branch.

Even then it was the normal thing to do to (fully) pay the credit card off every month by Direct Debit.

I have never had any interest payments due to a credit card company because of this system, after all, when needed, a bank loan is much cheaper than a CC overdraw.

In the present age even the credit card is not needed any more, virtually anywhere in the world I can use my bank's debit card to get cash as they are associated with Maestro.

Cheques are generally not used in The Netherlands as they are not guaranteed and you have to wait up to 14 days to get your money, it is only from the UK or the US that you sometimes see these expensive, worthless and outmoded things coming in, the IBAN system is much more efficient.

Car Insurance (0)

Anonymous Coward | about 6 years ago | (#24817053)

I only pay my car insurance automatically. I'm on a monthly payment plan and I've given State Farm my ACH number to do withdrawals from my checking account because otherwise I'd forget. Not to mention that my rate changes every month, with my 21st birthday, expiry of a car accident surcharge, and the subtleties of billing a six-month period on a monthly basis.

Common practice (5, Informative)

jasticE (196565) | about 6 years ago | (#24817067)

This has been common practice in Germany for as long as I remember (or live). If you do notice an illegitimate transfer, you can tell the bank to undo it, at which point it is up to the company again to bug you about the money. I think all in all, it's less hassle to just check whether all deductions are legit than to manually transfer money to your billers.

Re:Common practice (3, Interesting)

PerlDudeXL (456021) | about 6 years ago | (#24817171)

True.

My phone/internet company actually wants even a little fee for not using automatic
debit payment.

How about the good old fashioned way? (0)

Anonymous Coward | about 6 years ago | (#24817075)

Yanno, doing it manually? it may cost more when it comes to gas and there's a risk of doing it via snail mail, but, at least there's no direct access to my banking account.

No one, not even my employer, other than me should have access to my account. They can deposit to my account all they want, but direct access? go to hell.

"mistakes" happen and then there's companies that will deny everything and beat around the bush. Sue them? with what money? of course, if you're smart you have multiple accounts at multiple banks.

I may sound paranoid, but when it comes to money, it's your lifeline in this day and age, and with identity theft on the rise and cheap (and often outsourced) labor, and computers making mistakes, leaving no paper trail, etc. I find it disturbing how much people trust others with sensitive info.

Why Pay? (1)

thetartanavenger (1052920) | about 6 years ago | (#24817089)

I just don't pay my bills.. Problem solved. Hang on I think there's someone knocking at the door...

Re:Why Pay? (1)

Z00L00K (682162) | about 6 years ago | (#24817217)

What door? Hobos don't have doors unless they sleep in a toilet stall.

Re:Why Pay? (1)

Mathinker (909784) | about 6 years ago | (#24817421)

> What door? Hobos don't have doors unless they sleep in a toilet stall.

Idiot! It was his mother at the basement door. He meant that his mother pays his bills for him.

Re:Why Pay? (1)

thetartanavenger (1052920) | about 6 years ago | (#24817569)

Yes but this is one of those high class toilet stalls. Much nicer than your one at home I can assure you.

Verizon (4, Informative)

Anachragnome (1008495) | about 6 years ago | (#24817093)

I had to CLOSE a bank account to keep Verizon out of it. They first drew more then I owed them from it, then after I told them I wanted paper bills that I would pay myself(they also tried to charge me for the bills), and to not auto-pay anymore, they promptly attempted to draw the same amount, found they had no access to it and charged me an insufficient funds charge. I believe that was entirely intentional.

That was enough for me. Nobody has access to any of my accounts but myself. Not even my wife. That way when I have a charge to my account, I can ask to see my signature on something specifically authorizing it. No signature? Not my problem.

The hassle of dealing with idiots like that FAR outweighs the convenience of auto-pay.

Re:Verizon (1)

Skapare (16644) | about 6 years ago | (#24817407)

My father received an offer from Verizon to sign up for a plan than included flat-fee long distance. He decided to sign up. They gave him a date when it would be activated (for some reason they couldn't just click a button on the account and change it on the fly). So the date comes and passes. I was there at the time and wanted to do some long distance dialup access overnight (he didn't have broadband), so I called Verizon to check and they confirmed his account was indeed on the plan now. So I did the long dialups over 3 nights. Then he gets the bill and they charged him for the calls over $200. I dealt with them for him. When I asked them what happened, they claimed that even though he was on the plan, the long distance carrier had not switched him over, yet. But the long distance carrier was Verizon. So basically Verizon the local phone company and Verizon the long distance carrier couldn't activate accounts on the same day. It took a month to get them to admit their error, and 2 more months to get the late fees from this error removed.

BTW, the customer rep people themselves were friendly and tried to help. It's just the processes they are stuck with are so poorly designed, and they don't have authority to do anything beyond the options given on their screens.

Re:Verizon (4, Insightful)

ColaMan (37550) | about 6 years ago | (#24817681)

Nobody has access to any of my accounts but myself. Not even my wife.

I hope you've got things sorted out well for emergencies. Somebody has power of attorney, yes?

Shows why Slashdot is too Americocentric (0)

Anonymous Coward | about 6 years ago | (#24817113)

This article shows why Slashdot is far too Americocentric. I'm in the UK, and it's entertaining to read about Americans getting so riled up about corporate access to their bank accounts, and how it means they are somehow less free.

Here in the UK we have Direct Debit, by which we allow any company permission to take money from our account each month. It's underlined by the Direct Debit Guarantee, which means that if they take too much, I simply phone my bank and they give me the money back. No questions.

But I can't take part in this debate because, essentially, it's America only. The same applies to Slashdotters from all other parts of the world.

When is Slashdot going to realise (indeed, when is AMERICA going to realise) that there's an entire world outside of its borders?

Re:Shows why Slashdot is too Americocentric (2, Insightful)

KGIII (973947) | about 6 years ago | (#24817719)

Oh we know but this is a primarily American site. That's like going to America and then complaining that we're too American. Your point would (is, really) valid on sites like theregister.co.uk but not here. Not all sites on the internet are going to cater to your whims, you can create your own or find a more local site if you want. That is the beauty of the web.

If you need a reason not to trust them (1)

billster0808 (739783) | about 6 years ago | (#24817121)

Just look at Dreamhost. In January someone typed in the wrong number, and accidentally billed everyone for all of 2008 at once. Ended up overcharging 7.5 million bucks from one bad keystroke. Oh, and then they joked about it in their blog [dreamhost.com] . Gotta love waking up to a surprise 120 dollar charge, and the company just laughs it off.

Re:If you need a reason not to trust them (1)

KGIII (973947) | about 6 years ago | (#24817727)

People using Dreamhost are idiots in the first place. There's no way to get what you've "paid for" from them, ever.

I don't (3, Insightful)

mosb1000 (710161) | about 6 years ago | (#24817131)

I pay my bills online every month. That way I know exactly what I am paying. It's not that hard. The automatic payment thing is scary to me, because it takes control out of my hands. The only bill I pay automatically is my gym membership, because they wouldn't have it any other way. But at least that bill is the same every month.

I'd hate to pay my power bill automatically because it would have been a total surprise to me last month when it jumped from $50 to $160.

I write checks. (0)

jcr (53032) | about 6 years ago | (#24817139)

I've got a printer that does just fine feeding checks and envelopes.

-jcr

Well (2, Informative)

mikkelm (1000451) | about 6 years ago | (#24817145)

I'm using automated payment [betalingsservice.dk] .

To be honest, I don't see what the fuss is about. If I see a charge I don't agree with, I have it reversed, and confront the billing party, though that's yet to happen. I don't see how anything short of a good portion of cynicism could keep people from using this. I haven't done anything to pay any utility, telco or ISP bill for over a year. Even my rent is handled automatically. Saves me a lot of trouble.

Re:Well (3, Informative)

Grave (8234) | about 6 years ago | (#24817357)

It's not as easy here in the US to have a charge reversed, and if that charge causes you an overdraft fee, you can be really left out to dry in the meantime.

Re:Well (3, Insightful)

mikkelm (1000451) | about 6 years ago | (#24817401)

It's not a universal constant that reversing charges has to be difficult, and nor is it that you should incur overdraft fees that aren't reimbursed when a charge is reversed. It's down to the banks to handle the practical implementation in a way that consumers would agree with, but that does nothing to change the evidence suggesting that the concept itself, when properly implemented, is very successful.

It's done everywhere else, so why not in the US? (2, Informative)

Anonymous Coward | about 6 years ago | (#24817199)

Since I moved out of the US, I have paid all my bills online. Outdated methods of paying bills with paper checks do not exist here, like in the US. I've been paying bills online for years now and have never even once had a single issue. And I've never heard of anyone having problems here either, outside of single time when a fake bank website was set up and caught a few people. Anyone with even a remote knowledge of the web would have known it was a fake site though and it was shut down pretty quickly.

I don't get this whole anti-online payment mentality in the US. As long as your bank has the proper security in place, there is no issue. I would not hesitate to say that more fraud occurs giving CC numbers over the phone or sending payments through the mail.

Re:It's done everywhere else, so why not in the US (0)

Anonymous Coward | about 6 years ago | (#24817461)

Can you explain how sending a cheque through the post can result in fraud? Banks and financial outlets are not going to cash a cheque written out to Kuk Bajs Internet Services when some postal service schmoe with a driver's license or passport under the name "Sang Pho Cheauk" shows up and tries to cash/deposit it.

On the other hand, automated billing systems (in the US) that bill a credit or debit card, or take funds directly out of a bank account, can easily screw up, and are often conduits for malicious employees to gain access to your funds.

An (American) co-worker of mine lived in the Netherlands for 2 years. He told me how reliable all of the online methods were for paying bills there, ditto with automated billing. I asked him if he'd apply the same faith to our system back home in the States, and he said "Are you fucking crazy? I want paper statements sent through the mail".

The "anti-online payment" mentality stems from the fact that most (not all) commercial companies in the United States simply do not have their shit together. The system will fail, and you, the customer/consumer, will get fucked by it. It's not worth the risk -- and I've been there.

If you use automated payment, if the system fucks up, you'll personally spend hours upon hours on the telephone with said company trying to get the insanity dealt with. "No, no that's not what our system says here sir, the amount we deducted from your account is US$45.97" "But you deducted US$495.70!" "No sir that is not what our system says". It will take days, if not weeks, to get things straightened out.

With cheques and paper statements, this very rarely happens -- and when it does, it's because someone at the place of deposit typed in the amount wrong. If/when this happens, you tell your bank, and they do the investigative work for you, saving you time, stress, and effort. The erroneous amount deducted from your account will also be credited *immediately* until the investigation is complete, after which you'll probably find a cashed cheque withdrawl of US$45.97.

On the flip side, you'd be surprised how many Americans *do* rely on online bill payment methods. It's becoming more and more of the norm. I just happen to be one of those old fogies who has seen the "new system" fail too many times and have no desire to deal with the aftermath of such.

I'll trust paper.

What kind of payment automation to use? (3, Insightful)

RWarrior(fobw) (448405) | about 6 years ago | (#24817201)

None, for several reasons.

1) Billing errors occur. Don't allow them to take your money until you've verified the bill is correct. Otherwise, even if they correct the bill, you will never, ever get a refund.

2) Balance errors occur. Most banks will slap you for a $30-$40 NSF fee if someone sends an ACH debit transaction that's in excess of your available funds, whether or not they actually pay the ACH. Further, many banks play games about how fast they credit ACH deposits (like your direct deposited paycheck), or regular deposits (like your paper paycheck), in an effort to increase the likelihood you'll have an overdraft. What's more, when you swipe your debit card at a merchant, they can place a hold on your funds even if the final charge isn't anywhere close to the actual transaction amount. (Example: Buy $20 in gas at your local pump and find they "authorized" your card for $75. The bank holds the $75 for anywhere from 3 to 30 days. If you try to spend any of the $55 difference, they slap you with an overdraft fee because the funds were not "available," even though they're still "yours.")

3) Emergencies occur. If I need to take my kid to the ER and shell a large amount of money so that he'll have an eye tomorrow, I shouldn't have to call the electric company to get them to stop the payment so I can do it.

Most banks allow online bill payment, and many don't even charge a fee to use it. The good ones will even present my remembered vendors in a list, and allow me to simply enter the amount I want to pay, the date I want to pay, and click "send." Automatic payment benefits only the vendors and the banks, never the customer. I do not exist for a company's benefit; they exist for mine. Just because they prefer to swipe my account on the due date doesn't mean it's to my benefit to let them. They can take a paper check (or a CheckFree deposit) when I'm damned well good and ready to send it to them, and not a day before.

Re:What kind of payment automation to use? (1)

wdsci (1204512) | about 6 years ago | (#24817493)

Actually I beg to differ - if you're relying on a transaction clearing on a specific date in the future, or if the ability to cancel payment on an electric bill makes the difference between being able to pay for an ER visit or not, you're probably not practicing good money management. I try to use automatic payment whenever possible, since it's one less thing for me to remember and to do every month. However, I do make sure to get some kind of confirmation message every time one of these automatic bill payments is posted to my account; that way I can keep my own independent records of what transactions should be occurring. If my records don't match the bank's records at any time, it's easy to investigate and find out what the difference is.

Also, for the record, ACH transactions uniformly take 3 days to clear, at least from one institution to another. Depending on the type of transaction, a bank may add an additional day for internal processing, but still it's usually fairly predictable how long the transaction should take to clear. Although if you're relying on money coming into your account (or going out of it) on a certain specific date in the future, that's another symptom of bad money management. My principle: do not spend money until I've actually verified that it's in my account. (For automatic bills, I'll usually make a transfer using online banking a few days in advance, enough time to try other avenues - i.e. make an ATM deposit - if something goes wrong.)

I did this once and stopped it the first month (4, Interesting)

HomerJ (11142) | about 6 years ago | (#24817207)

When I moved into my last apartment I decided to do the auto bill pay. I'm just lazy with paying things and sometimes I'll forget to pay something.

Well, for those of you that pay a gas bill, you know they bill you an "estimated" rate, and then the actual the next month. Well, for a small apartment who's gas bill was maybe $20 for a month, they decided to take out a $320 "estimated" payment. They had no idea why it was so out of whack with the actual, but it was what it was. Normally you just send in an "estimated" payment as well, they just readjust your bill, and send you the actual the next month. Well, with the automatic payment, the bill said $320, and that's what they took.

It ended up just being that I told them to keep $320, and I just wasn't going to pay my bill for like 18 months. Which was fine with them. But they never actually fixed the estimation. The next bill, I had a $300 credit, following I owed $300, next month I had a $280 credit, etc. etc.

Long story short, you don't know what these people are going to charge you with. They take money first, and then just deal with you later if you don't like it. I'd rather pay a late fee, than deal with a CSR rep on why they took too much money.

Direct debit, e-billing etc. (1, Interesting)

Anonymous Coward | about 6 years ago | (#24817209)

I have something of a system set up (although I don't follow it that strict):

1) Direct debit (company can withdraw the money automatically from my account): I use this for recurring, fixed payments (ADSL connection, bi-annual insurance payments etc.)
2) E-billing (I receive the bill electronically to my online bank, where I can approve or deny it): this goes well for monthly bills with varying totals, such as credit card bills. I can also change the payment total if I want to e.g. pay less than the full amount to the credit company.
3) Traditional paper bill: for magazine subscriptions (gives me a chance to think if I want to continue subscribing) and the rest of the miscellaneous billing

multiple accounts (0)

Anonymous Coward | about 6 years ago | (#24817211)

I used multiple methods of auto-pay. However, I have a 2nd checking account for auto pay purposes (and a third one for online gambling). I like being able to turn things off at the source if something goes wrong.

None (1)

steelcobra (1042808) | about 6 years ago | (#24817255)

There's no reason whatsoever to give billers access to my money when I can just pay them online. It's not as if it's that hard to remember who I have to pay the 1st and 15th of every month.

Hmm... (1)

Beefslaya (832030) | about 6 years ago | (#24817259)

How can I be out of money? I still have all these checks?

Interesting update... (4, Informative)

fortunato (106228) | about 6 years ago | (#24817263)

My favorite part, if you've RTFA to the very end, is this:

UPDATE In last weeks column on socially responsible investing, I mentioned an exchange-traded fund called the HealthShares Emerging Cancer Fund. What I failed to notice, because the company hadnt bothered informing potential investors on the funds own home page, was that the day before my deadline the company announced it was shutting down the fund in September.

Now here is someone you should definitely listen to.

CC Dedicated to automated bills. (0)

Anonymous Coward | about 6 years ago | (#24817281)

I have one Credit Card that is dedicated to just utility/reoocuring monthly charges. I review the account often. since it is a CC and not my Checking account I get the added protection that the CC offers. I have my Checking account setup to send the CC half of the total months charges every time I get paid (Biweekly). Using this method I have saved MANY over draft charges that I had previously using mailed Checks. Plus it eliminates deadlines. I don't have to worry about there being money in my checking account on a certain date.. it's all covered by the CC and I just send them their piece of my money when I have it, not when they want it/need it. There are no interest charges because of the grace period since I leave no balance. Also since I'm on average bililng for many, it makes budgeting a breeze. Since I have Direct Deposit, everything pretty much takes care of itself. Furthermore, I have canceled all paper billing and receive everything in email so that there is less chance of identity theft. The only bill I've been unsuccessful at this process is the City water bill. I can pay via CC, but not automatically.

Automated payments destroy jobs (2, Interesting)

Skapare (16644) | about 6 years ago | (#24817291)

A friend of mine told me that many of her colleagues at work have lost their jobs as a result of automated payment systems. And she's fearing her job might be next. She's a debt collector.

Re:Automated payments destroy jobs (4, Insightful)

sydbarrett74 (74307) | about 6 years ago | (#24817355)

And this is bad how? I'm sure buggy-whip and horseshoe makers bemoaned the loss of their jobs with the advent of that new-fangled motorcar gadget. I'm sure those debt collectors can adapt.

Re:Automated payments destroy jobs (1)

mr_matticus (928346) | about 6 years ago | (#24817745)

That's the point. OP was engaging in what is called a rhetorical style in conveying his narrative tale.

More troubling than your failure to grasp that, though, is that damned buggy-whip example. Is it a shibboleth for some underground Slashdot group? Because it's not like there was ever a large buggy-whip industry in the first place. As a tale of adaptation, it's lacking. And somehow, no one uses it to talk about American programmers adapting to outsourcing by finding another job or lowering their salary expectations. I guess it only works one way.

Re:Automated payments destroy jobs (0)

Anonymous Coward | about 6 years ago | (#24817389)

I think this is suppose to be a joke, but I don't think it's funny.

Silly me (0)

Anonymous Coward | about 6 years ago | (#24817331)

I thought this story was going to be about losing money in vending machines.

Own bank's bill-pay system (4, Insightful)

LoadWB (592248) | about 6 years ago | (#24817339)

I use my own bank's bill-pay system, because they take all responsibility. If it says a check is to be to my electric company by the 15th and it isn't, THE BANK calls the electric company and explains the situation, then deposits any late fees into my account.

In the past using my billers' systems has been a nightmare or two.

One double-billed me one month and would not refund the second billing because my next bill would be due by the time the return would process. The bank could not reverse the charge because the payment came in with my authorization.

I've had more than one bill me too early.

And recently my cell phone bill was over $500 in error two months in a row because of a missing billing code on my data plan. All sorts of fecal matter would have hit the fan if those payments had been automatically debited.

And other incidents of which I cannot recall the details.

Unless the biller is willing to take responsibility for errors on its end and IMMEDIATELY return money taken in error, as well as cover whatever fees or damages are incurred due to the error, payments come via bank bill-pay only. And if that is not acceptable, then the account gets closed and I move on.

How is it done abroad? (2, Informative)

atomico (162710) | about 6 years ago | (#24817345)

It might be of some help to know how is it handled in other countries...
Where I live (Spain), direct debit has been the rule since long ago: almost everybody does it this way. Utilities (electricity, telephony, gas, mobile phone), insurance, mortgage, all charge your bank account monthly or bimonthly. It is convenient (especially for them) and problems are not too common, although they exist. But then you can dispute the charges or go to the consumer protection office.
Banks try to push you to do it this way: most of them only let you pay your bills only one hour per day (for example, from 10 am to 11 am only).

My personal take on all this: I like it this way. As I said before, problems are rare; it is far more usual to know someone that has had his credit card number stolen than to know a case of having trouble with direct debit. And to have something less to care about is worth it. Anyway, most of the time the bill gets to you by mail two or three weeks before the charge is made, so you can check it and have some time to fix the problems (good luck with that though).
Overdrafts are allowed, but they are easy to avoid. Actually, banks like so much this system that they will equate having this kind of automated bill payment with being a regular, good customer: in most "fidelization" promotions, they ask you to have two or three bills paid through them.

Risk management 101 (1)

macraig (621737) | about 6 years ago | (#24817351)

If only 38 of every 100,000 people fall victim to this sort of mistake, I suspect that I'm more likely to fall victim to a car accident than this. It figures that some people might freak out at any suggestion that they give up even the slightest degree of personal control (read: micromanagement).

I use my Bank's automated bill payment system. I lose some small degree of control, but in fact that is indeed the entire point of the exercise, n'est-ce pas? I don't want that monthly control of those bills nor the time and mental distraction that the process of paying them would require. The bank's system handles it one of two ways, depending upon whether a relationship with the payee exists: either it's transmitted electronically or an actual check is cut in my name and mailed in advance of the due date. I retain full control to monitor, modify, or cancel those payments at any time; I have limits set on them to prevent unexpectedly large bills from causing overdrafts, and I receive e-mail reminders for every single one.

I frankly don't see the problem, done the way I'm doing it. I agree that allowing direct drafts or using credit cards are bad ideas, but only an ignorant uninformed person would consider or agree to such mechanisms.

MyCheckFree ftw! (1)

sydbarrett74 (74307) | about 6 years ago | (#24817365)

I use MyCheckFree.com -- completely free, no monthly fee like a lot of those consolidated bill payment services. My only complaint in five years of using them is that more companies don't offer payment through it.

Whos money is at risk from mistakes? (1)

thogard (43403) | about 6 years ago | (#24817373)

I work in the auto payment insdustry. The number of errors are small but they do exist. Sometimes someone submits the same batch twice or the account numbers get converted into floating point and back.

Remember that if you give a company your credit card number and they screw up, they take a banks money. If they screw up with direct debt, they take your money.

Why is this news? (1)

houghi (78078) | about 6 years ago | (#24817375)

Is this not something that is done by default in the USofA?

In Belgium this is very standard practice. Especially for fixed amounts, like your provider or electricity. It is also done with varable bills, like your credit card. In the Netherlands, you can even give somebody an allowed one time to do this for purchases over the phone. Something that is not possible i Belgium.

Stopping this is done almost immidiate and I yet have to hear about big problems. Smaller problems exist, but those get payed back almost immidiatly. Usualay you pay about 1EUR less if you use it. The reason it is cheaper is because it is also cheaper for the company. One of the high costs of a company is to get money from people who pay too late or not at all, even though they have a signed contract to do so.

The company needs to send two reminders and then aquire a billcollector. And all of this just because the person forgot to pay. People who are unwilling to pay won't be using this anyway, so it is so people don't get charged for late payment, while the company has less work looking for those 25EUR you need to pay each month for your internet.

I am happily using it for many things where I would be willing to pay monthly anyway and the moment I want it to stop, I do so online and the automatic transfer is stopped. So they not so much take what they want (exept for the credit card company) they get what I give them.

The credit card company also can not withdraw more then is on my account and in Belgium everybody has two accounts. One davings and one to use with others.

I don't use any form of automation. (1, Interesting)

Anonymous Coward | about 6 years ago | (#24817383)

I receive paper statements, which includes a bill. When I receive said bill, I fill out a cheque and mail the payment.

It's that simple.

Why do I use this method? Because it's been established as the "norm" historically, and it also provides a hard paper trail for any billing transactions. "Actually sir, you owe us another US$35.49..." "Hmm, not according to this paper bill you sent me last month" "Oh, I'm sorry, you're correct".

The only caveats to classic paper billing are: 1) forgetting to send your payment, and 2) postal system goes fuck-all and /dev/null's your postal mail. #1 has happened to everyone, because we're human. #2 has happened to me a couple of times, and when reported, the postal service was quite concerned.

I'll trust my own ability to pay my bills over a computer or automated system any day. It amazes me how many people rely on automated electronic billing. All it takes is one fuck-up and your entire bank account or credit card could be out of funds. Is it really worth the risk?

All recurring expenses on credit card (1)

drsparkly (65767) | about 6 years ago | (#24817469)

and every other bill payment that I can, then I pay it all off at the regular time.

My card has 40 days interest free. All the purchases I make are budgeted, so there's always enough to pay the balance. My pay goes into a high interest, internet only account, where interest is calculated daily and credited monthly.

* I earn reward points, enough to pay the yearly credit card fee and maybe a little bit extra.
* I have to pay one regular bill rather than 4 or 5.
* I don't have to worry about having money in my bank account.
* The money can stay as long as possible in the internet only account and earn more interest.
* I get to keep my money a little longer.

It works for me, YMMV.

In Europe it is irect debit, not credit card. Why? (1)

GeneralSunTzu (1163223) | about 6 years ago | (#24817673)

I am quite surprised to see that none of the posters has pointed out, so far, that direct debit is preferred in Europe because of the deep difference in the banking systems with the US. In Europe, except for the UK (primitive and consumer-hostile banking) and France (deeply rooted customs), practically nobody uses checks.
Here in Belgium I last wrote a check nine years ago.
This means there is very little manual compensation activity, and instead most countries have a uniform EFT system, that works from a home computer (my bank offers a package that runs on Linux, Win, and Mac OS X).
In Belgium again I can transfer money from one of my accounts to an account I know very little about within half an hour for free.
Also, for those who are afraid of getting a debit entry of EUR 5000, you can also set, again standard practice here, direct debit with limits, so that for instance the gas utility can take money from your account up to, say, EUR 500. That should reassure even the most paranoid consumer.
To recap:
a. a uniform, in Belgium free, EFT system exist, unlike in the USA;
b. checks are now, with the exceptions noted, essentially obsolete;
c. you can temporarily dip into red and it is not a big deal;
d. you can set a limit on the direct debit, so to avoid keying mistakes.

Simple. (1)

PotatoFiend (1330299) | about 6 years ago | (#24817589)

What kind of payment automation do you use, and why?

My system isn't completely automated, but it's like clockwork.

Every 9 months, I divide my first-born into several equal pieces and send it to the billers. Then I screw my wife, the billers screw me, and the cycle continues.

Missing option (1)

93 Escort Wagon (326346) | about 6 years ago | (#24817609)

I receive most of my bills electronically at my bank - but they don't take the money out of my account. I review the bill and I schedule the (single) payment electronically. I can also electronically send checks to billers who don't support online billing and/or payments.

So basically it's just like the old system (paper bills and paper checks), but online. The control over making the payments is still in my hands, not the billers.

Why would you give these guys the ability to pull money out of your account at will?

handwritten checkss (1)

suck_burners_rice (1258684) | about 6 years ago | (#24817645)

I use the automated payment system of handwriting checks that have carbonless copies for my records, stuffing them into envelopes along with the stub from the bill, sticking a postage stamp and a return address stamp on the envelope, and popping that whole darn thing into a mailbox. Automated payments are so "convenient" but handwritten cheques are the only way to go.

I pay everything by direct debit (1)

jackhererUK (992339) | about 6 years ago | (#24817657)

Things that are the same amount every month like mortgage or gym membership just come out of the account on a particular day of the month. Other things just as mobile phone bill, cable bills etc i get a bill about 2 weeks before the money comes out and it tells me when the money for the bill will be coming out of my account. If for whatever reason i didn't want them to take the money i can cancel the DD at any time. I have never personally had any kinf of problem with DDs though they can happen. If they do the Direct Debit Guarantee states that the bank will just give you your money back if you ask.

Online Banking/Bill Payment (1)

Iftekhar25 (802052) | about 6 years ago | (#24817703)

My bank has a Bill Payments facility in their online banking. It allows you to elect a recipient, and the amount. When I get my paper bills, I just key in the exact amount, select the right recipient, and do it manually.

Each transaction comes with a unique 10-digit transaction identification number. Just keep that in case there are issues (which has never happened yet). Takes a few days to process.

I don't want people to be taking money out of my account, so I will never set up an automated payment system. I want to know who I'm paying how much. It's a good way to keep track of what you're spending on.

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