Direct debit is a payment service designed to simplify recurring bills such as water, electricity, insurance or telecommunications by allowing a creditor to debit the customer’s account based on the consent given to them. This convenience, however, can become a problem when an unexpected charge arises and the account holder only notices it after the money has already been withdrawn.
In Portugal, the rules of the Payment Services Legal Regime make it clear that an unexpected direct debit does not, in itself, mean lost money.
The first distinction to be made is simple: if the charge was authorized, there are situations in which a refund can be requested; If it was not authorized or was executed incorrectly, rectification may be requested within a much longer period of time.
When the bank has to return the amount
For already executed SEPA direct debits, the customer can ask their payment service provider to refund an authorized charge within eight weeks from the date the account was debited. After receiving this request, the bank has 10 business days to replace the funds in the account, unless it concludes that the applicable legal conditions are not met.
If the debit was not authorized, the framework is even more favorable to the customer. It establishes that the operation can be communicated to the bank without undue delay and up to 13 months after the debit, and it is up to the payment service provider to demonstrate that the operation was authenticated, duly registered and did not suffer from technical failures.
The same law determines that, in the event of an unauthorized transaction, the bank must immediately reimburse the payer and, as a rule, by the end of the first business day following knowledge of the situation, unless there is a well-founded suspicion of fraud.
What should you do as soon as you detect the charge
In practice, the first step is to immediately contact the bank or payment service provider where you have the account. The rules in force say that the client must report the transaction as soon as they become aware of it and without undue delay, especially because the 13-month period serves as a maximum limit and not as an excuse to let the matter drag on.
If the charge has not yet occurred, but has already been detected in time, the customer also does not need to wait for the charge to take action. The BdP explains that, when the amount indicated by the creditor is incorrect, the bank may be asked to reject that specific charge, as long as the request is made by the end of the business day before the scheduled debit date.
When the problem is linked to an old authorization, a contract that has already ended or an entity that can no longer charge, there are still two fronts to be dealt with.
The cancellation of the account debit authorization must be requested directly from the creditor, while the inactivation of this authorization can be requested from the bank, including through Multibanco, home banking or over the counter, to stop future charges on the account, in accordance with .
How to reduce the risk of it happening again
Portuguese rules also allow for preventive brakes to be created for direct debits. The customer can define maximum amounts, frequency, deadlines, positive lists of authorized creditors, negative lists of prohibited creditors and even a total block of this type of charge, measures that can be adjusted with the bank and, in some cases, through Multibanco or home banking.
If the bank does not act as it should, the debtor can complain to the complaints book or directly to Banco de Portugal. The supervisor can analyze the institution’s performance, demand the correction of procedures and sanction more serious infractions, but compensation for any damages will have to be requested by the client himself in court or through alternative means of dispute resolution, which also exist for conflicts linked to payment services and direct debits.
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