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Comment by hackerboos | Hacker News Reader

The biggest obstacle to GoCardless in my opinion is failed Direct Debit charges from banks.

As a consumer, if I use GoCardless to buy a product and there are not enough funds in my account I'm charged by my bank up to £35 ($58).

If a Debit Card payment fails then I'm charged nothing.

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I really don't see how that's an obstacle. The service they provide isn't based on a brand new way of payments, it's simplifying an antiquated process that is generally a PITA.

Companies & individuals won't stop using direct debits, at least in the UK, for a very long time.

It's a big obstacle to uptake only if you have a choice between direct debit and something else. Almost 100% of the time when an organisation has to use direct debit, GoCardless is superior to the antiquated incumbent solutions.

It's also a challenge for merchants, because the fact that the payment fails may not be known for up to 5 days. I would love to see if GoCardless could do something with the FasterPayments system as well, which processes in a matter of hours.

We'd love to speed up the Direct Debit system - unfortunately that isn't likely though. That is why we focus on recurring payments, where merchants are able to time the payments in advance.

If Faster Payments opens up, we are well placed to adopt it.. It's on the banks & regulators to open it up though (current access is closed). Watch this space!

Just as another datapoint, my bank charges the same £15 fee for a failed transaction regardless of whether it's a debit card payment or direct debit.

Yes - there isn't much consistency around this. Failed transaction costs are really down to each individual bank.

We really hate this practice, and don't feel there is any legitimate justification for it. One of the many reasons we are strong believers in disruptions to the banking industry.

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