How we handle a dishonour


Direct Debit is the simplest and most effective method for controlling ongoing payments. Once a request is sent to your customers bank the payment is generally deemed accepted unless the customers bank advises otherwise. Payments can dishonour for any number of reasons (see dishonour codes)

How we handle a dishonour

When a payment is dishonoured we will:
  • If funds have not been settled to your bank account - reverse the payment and not settle the funds
  • If funds have been settled to your bank account - reverse the payment and either Debit the dishonour amount from your bank account or take this off any other funds which have not yet been settled.
If the payment was returned "Refer to customer" we will attempt to redraw the payment on the customers next instalment date. Any other dishonour reason is considered a permanent failure and will result in the Direct Debit Schedule being cancelled and  a new Direct Debit Request being obtained from your customer.


Dishonours are generally received from your customers bank within 2 to 3 business days. Although rare payments can still dishonour some time after this period in special circumstances. In line with our obligations as a participant to the Direct Entry system we are required to accept any dishonours that may occur after funds have been cleared.
For more information see the attached fact sheet provided by the Australian Payments Clearing Association.
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