There are various reasons for returned direct debits. This can occur due to errors in the application details (e.g. wrong account holder, double debit), errors caused by a customer (account blocked, insufficient funds) or disputed situations (reclaim because no valid mandate exists).
If a direct debit cannot be made successfully, FlexFinance is informed by the payment system and a message with detailed information is generated for the user.
Depending on local legislation, returned direct debits can arrive weeks after implementation and usually include third-party charges. After a specific waiting period, the direct debit process is repeated and if this fails, the payment method is automatically switched to ‘self-payment’. Any failed direct debits are taken into account in legal debt collection proceedings.