Understanding the Differences Between Direct Debits and Standing Orders: A Beginner's Guide, by Two Teachers on YouTube. 2 min 1 s.
- Video length
- 2 min 1 s
- Time to do it
- 5 minutes
- Difficulty
- Easy
- Steps
- 7
What you need
Steps
Understand that both are automatic payments from your bank account. A direct debit lets the company collect the money, while a standing order is a fixed payment you send yourself.
Use a direct debit when the amount changes each time, such as energy bills or a phone contract. You give the company your account details and authorise it to collect.
Check the Direct Debit Guarantee. It protects you if the amount or date changes, and your bank must refund you if a payment is taken in error.
Set up a standing order for a fixed amount, such as rent or savings. You choose the amount, the date and how often it leaves your account.
Give the payee your sort code and account number for a direct debit, or set the standing order up yourself in your banking app.
Remember the key difference: with a direct debit the company controls the amount and date, with a standing order you do.
Cancel either one through your bank or banking app. Cancelling a direct debit also means telling the company so it stops collecting.
Tips and common mistakes
Check your statement after the first payment to confirm the amount and date are correct.
A direct debit can change without warning, so keep an eye on variable bills.
A standing order will keep sending the same amount even if the bill changes, so review it regularly.
Questions
Can I cancel a direct debit myself?
Yes. You can cancel it through your bank or banking app at any time. It is also wise to tell the company so it stops trying to collect.
What happens if a direct debit takes too much?
Under the Direct Debit Guarantee your bank must refund you. Contact your bank as soon as you notice the error.
Which is better for paying rent?
A standing order suits rent because the amount is fixed. You control the date and amount each month.
This guide was drafted from the video's details and general task knowledge. It has not been checked against the full video. Check the video and relevant product instructions before following a procedure. Report a correction.
