What is a Standing Order?

A standing order is a method of establishing a regular, fixed payment from your bank account.

You can schedule a payment to be taken at a determined regularity (for example, the 3rd of every month) and for a set amount of time, such as three months. Your payments will consist of money that is set at an amount that was chosen by you.

You can usually set up a standing order by accomplishing a standing order form and submitting it to your bank or arranging the standing order over the phone, in the branch, or by using online banking.

What is the difference between a standing order and a direct debit?

A standing order is basically an instruction to your bank, whereas a direct debit, on the other hand, allows a company to take money from you. You are the solely the only person who can change the payment amount or the date on your standing order. This is the principal difference to a direct debit, where these circumstances can be changed by the organisation or the person that you are paying.

What if I do not have enough in my bank account to pay for a standing order?

If there is not enough money in your account to pay for a standing order, you may be allowed to take advantage of a buffer zone, if your current account includes one. This is essentially a small interest-free overdraft that your bank would not charge you for if you sneak into it.

Your bank or building society may refuse to pay for the standing order if you exceed the buffer zone. They may also charge you a fee. You may also be asked to pay for additional charges if paying for a standing order pushes you into an unauthorised overdraft.

If you already know beforehand that you would not have enough money in your bank account, the safest thing to do is to arrange an overdraft that is temporary with your bank in order to pay for the standing order. Alternatively, you could attempt to negotiate a later payment date with the person in question.

If you regularly miss standing orders, you should consider paying by a different method or changing payment dates.

How long will it take for a standing order to reach the recipient?

The Faster Payments service can be used to make standing orders which means that the payment can be received on the same day, or the next working day if the payment is made on a bank holiday or a weekend. If your bank does not make use of Faster Payments, it may take three working days for a standing order payment to transfer from one bank account to another.

How do I cancel a standing order?

You are the only person that can opt to cancel a standing order. You can cancel a standing order at any point in the branch, via secure online banking, or over the phone or. You will have to make sure that you inform the person or organisation that is due to receive the payment before you do, as you could incur penalties or fees for non-payment. Remember that if you do not pay a bill on time, this could also have an effect on your credit rating and appear on your credit file.