The difference between automatic payment and direct debit you need to know!

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Along with the times, people now prefer that everything can be done easily and practically. In fact, the payment system can be done automatically without making it difficult or bothered by forgetting.

So don't be surprised if automation is an alternative that makes all payments such as bills, instalments, tuition fees, all of these things easier. So what is the difference between these two automatic payment systems?

Automatic Payment

This automatic payment is also called a regular payment which you can set with the payment system platform that you use such as e-wallet like GrabPay, TouchnGo, Apple Pay or others.

When using the online banking platform, you can choose which bank account you want to use if you have more than one bank account.

Before starting the automatic payment system, you can set a number of things, such as the total amount to be paid, how many payments you want to make, etc., for example,in January because at the beginning of the year, you choose to make two payments in the middle and end of January (only certain e-wallet).

The Platforms

There are many platforms that can be used as automatic payments, the most common today is E-wallet because verification is very easy and setting up automatic payments is easy too, then there is MBB like M2U own by Maybank but it has a complicated verification process because you need to open a bank account first. just created your MBB account and there is Apple pay which is usually used to pay for Apple music subscriptions, paid applications and others and there is Grabpay which can use for their platform purpose only like grabfood, grabcar, grabmart, etc and each platform has different functional extensions.

So, what if insufficient funds?

What happens when your bank does not have enough balance? 

Then the payment cannot be continued until you have sufficient balance in it and the bank will auto try again after your balance is enough.

However, you can change or cancel the automatic payment at any time via your e-wallet platform or your bank account.

Direct Debit

So, what about Direct Debit?

Direct debit is also called official payment through a valid authority or known official bank, such as Maybank, CIMB, RHB, etc.

Direct debit also requires approval from each bank through a signature or stamp. It has been known for a long time to fix payments such as electricity bills or loan debts to banks to pay for a product/ service.

People make direct debit payments according to a predetermined due date so it can't be changed or as we wish when we pay it.

For example, at the beginning of ratification or granting a debit - like your housing loan, the bank notifies your direct debit schedule every month on the 10th, every 10th the money in your bank account will be automatically deducted according to the payment amount that has been determined at the beginning.

BD Pay

In the rental market, BD Pay assists with an automatic payment method that eliminates manual systems where one of them is in collecting property rental payments so that agents or landlords don't have to worry about forgetting to pay rent by their tenants. BD Pay uses FPX direct debit which is a convenient, efficient and less cost interbank collection service to make recurring payments. It is the latest evolution in the payment history for the rental market.

But, what if there are insufficient funds in the bank?

It happens! We know. So, in this scenario, the bank continues to withdraw your money and the bank will charge you an overdraft fee (or not), depending on the agreement between you and the bank. 

If you don't want to use your current direct debit bank service, then you have to really make sure that your direct debit has been cancelled and you also have to meet the direct debit service provider directly.

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