South African banks have come under fire for processing December debit orders earlier than usual.
But even as account holders express shock and frustration, financial service providers say it’s common for accounts to be debited early during the festive season
If you’ve got debit order agreements with various companies, there’s a good chance that some of them will take their money from your bank account before the month-end date.
South African banks say this was because many were being paid earlier in the month.
With the opt-out function offered by some banks to keep debit orders at their usual dates, some account holders are now fighting reversals and penalties.
Consumer journalist Wendy Knowler said it was common for accounts to be debited early in December by financial service providers.
“It’s been going on for a number of years but not all credit providers do it. However, this year, more of them are doing it and even earlier because so many of their client base burn through their salasriws within days.”
FNB was one of the first providers to be met with criticism ahead of the festive season, when clients received debit notifications by SMS.
While Capitec and Nedbank have also confirmed an early debit campaign.
But can they legally do it? Knowler said if you’ve signed the fine print, you do not have a legal argument.
“Unfortunately for many, when you sign a debit order contract, there’s a lovely – or not so lovely – clause that says they might debit early in December and that is consent. But they must still notify you because it’s bad manners.”