Direct Debit as a payment option

Not sure if this has been asked before.

Have OntO considered taking subscription payments by Direct Debit, rather than just by Debit or Credit Card.

This could be setup with the likes of GoCardless and managed on a month by month basis, we do the same with our Sheffield Eagles (RL) season tickets, its setup for 3months than it cancels out.

It also means people can budget easier and also be in control a bit more and not reliant on banks doing security checks on card payments. which can cause more problems.

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That’s interesting as Pivotal JLR have just switched to Direct Debit and Gocardless.

For those that are currently paying on credit cards it means they would have to find a double subscription amount in the switchover month, so some might find that they just couldn’t afford the switch.

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The way i have seen it work is you have to setup a Direct Debit 14 days before your payment is due, then their shouldn’t be any issues with double payments.

But agree for some their maybe challenges, who have existing payment methods, but always good as an option. :slight_smile:

Give me credit card payment any day- points all the way!

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Yup. I’ll keep my Amex points thank you :slight_smile:

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I think it would be a great idea but possibly a bit too complicated for onto. Considering it’s a rolling monthly contract that can be ended at any time/cars swapped and the chances of onto cancelling your subscription due to their terms and conditions (never heard it happen but it does state they can cancel your subscription if you don’t meet their criteria, ie speeding, etc).

I was working with a subscription based company a few years ago and all their customers wanted it to be via direct debit as it was easier, but the company didn’t want to because of the many scenarios that could complicate things.

It was a monthly rolling contract and the customers could cancel/change their products at any time, also a lot of customers would get banned for not returning the items on time, so they felt card payments would be safer long term, as they 100% have the money up front for each month and no chances of failed direct debits.

It would be really nice if onto did it though!

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Merchants have non-zero risk with card payments as well- credit card customers have protection under Section 75 of the Consumer Credit Act 1974.

I’ve only had to reverse one payment ever under Section 75, it was last year when a broker I used just failed to respond for months after promising a refund for something, but it was a pretty trivial process to claim back with Amex.

The onus is on the merchant to not fall foul of that act, but it’s certainly not right to assume that if it’s paid with a card that there’s no potential recourse down the line.

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and a lack of points/cashback - it was quite a chunky item so had good payback!

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Would likely be cheaper for Onto on direct debit… but I guess it feels less convenient and certainly on startup credit card has a less friction payments journey.

Onto should employ me to do their product management :joy:

(Says the large credit card that may have been mentioned above product director lol!)

I think its different choices for people as not everyone likes credit cards, although they do offer points and cashback :slight_smile: and also some protection under section 75… but you do have issues sometimes with Security Checks, and banks flagging them as fraud / suspicous

People like DD’s as they are easy for money management, and if coming out of your current account, you dont have to remember to pay your credit card off each month to cover the bill (as good boys and girls you should do :stuck_out_tongue: if you pay by that method ) you are also covered by the DD guarantee…

Choice is a good thing :slight_smile:

What would the benefit of a direct debt be over a debt card anyway? (Especially for onto who would have to start taking a deposit worth at least a weeks rental when people booked their cars)

Edit: removed first paragraph after someone text me to let me know of a company that did monthly direct debt for car hire.

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Elmo use Direct Debit for their payments

I dont compare OntO to other hire companies in the true sense, I would compare them to the likes of WagenX, VolvoCars, Mocean and a couple more who are starting in the same field as OntO and are offering Car Subscriptions or as im going to term it CaaS (Cars as a Service) who offer the ability to pay for the monthly subscription by Direct Debit.

There is no real difference between a debit card or a Direct Debit, as they are both linked to a bank account, a direct debits offers protection to both parties, all payment methods are reliant on people having the funds available. A card number not being compromised, replaced etc, as we have all done it got a new card and forgot to update someone…

why would they need to take a deposit with Direct Debit?
One option would be to take the first month on Credit or Debit Card and then future monthly payments, insurance companies work this way…

You could even go down the route of the new Open Banking payment system.

Its about choice and building the user base, and not every payment option s

I still don’t understand the reason for not just paying via a debt card / credit card. You even say there’s no real difference.

Yes cards get replaced but is updating the card details on the website once every 3 years so big a deal that you would want to setup a direct debt to take money from the same place?

Maybe I’m being really naive and just have no concept of how others pay for things / budget.

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I believe onto even gets the new card details automatically through Visa account updater/Mastercard Billing Updater

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Banks do security checks on payments and card numbers get compromised through data breaches and cards fail (I have 2 this year where the card has failed / been compromised) and its a royal pain updating every single service that I had it with.
I know people who budget using Direct Debits and create pots or saving accounts to pay bills, and then have other spend seperate.

@lgrok That is only on certain cards, as not every card provider supports this…

Thanks for taking the time to explain.

I’m not trying to shoot you down, just understand the reason someone would prefer it over a card payment.

If I’m honest I’d still prefer card payment personally, however as you said more options for customers can’t be a bad thing so if this was something enough people wanted then I’m sure onto could look into it.

I know your not :slight_smile:

As you say its good to have more options :slight_smile: and that is what I was trying to get across…

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Issue is with a card on file ONTO have more chance of getting their money, a direct debit can be cancelled. Not so easy with a card due to the inconvenience.

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That’s such a good idea.