Recurring card payments

There are two other main types of regular payment – direct debits and standing orders. These generally give you greater control over what payments go out of your account and when. Here's how each works:

• Direct debit. This is an agreement with a company for it to automatically take an amount from your account on a regular basis. This is usually on a set date and for a fixed amount, though the amount can vary. For example, you could set up a direct debit to pay your credit card on the 25th of each month and choose to pay a set amount, say £100, or choose to clear whatever amount you owe in full. Common examples include bills such as energy, council tax and broadband. 
  
  You can cancel these payments via online banking or contacting your bank. You're also covered by the Direct Debit Guarantee which means if there's an error with the payment, your bank must refund you the full amount. 
  
  
• Standing order. These are regular payments for a fixed amount you set up yourself via your bank, so you can change or cancel whenever you like. These are typically used to move money from your account to another, such as paying rent to your landlord or moving money to a savings account, rather than to pay a company for a service, though mortgage overpayments and service charges are examples.

Just remember that cancelling the payment with your bank won't cancel any contract with the provider, so it's best to check with the company concerned before cancelling in case you need to give notice, have an outstanding balance or will incur a penalty to leave.

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