I came to post something similar in a perhaps slightly softer tone 
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Apologies for the tone. I probably should’ve had my coffee first 
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I have mentioned in a previous post that once you get mass, mainstream customers this could become a real issue for Monzo as the established behaviour has been set already by the banks the customers will be moving from. Compounded by the fact it’s then for the user to resolve any failed payments direct with the companies.
I might be exaggerating but it feels like a ticking time bomb 
The other was debits before credits that made it worse but I believe this is now resolved. For this one starling also have debits before credits but I have an overdraft to compensate for it. They should also swap them around though.
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I’m a huge proponent of 
Monzo but this is true, and is why I only have one Direct Debit set up on my account, which I can monitor easily as the payee also sends a notification when it is paid.
Most people, myself included, just don’t care about back office systems, partly due to the obsfucation of legacy banking which won’t ever show a real balance. But if a payment is due on a certain day, we would all expect it to be paid at some point during the day, not attempted once and failed if there was any break in the payment chain. This is critical for mortgages, loans and credit cards where the penalties (financial and reputational) are huge if a payment is not delivered.
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Has anyone ever confirmed anything is broken about DDs? Standing orders can fail with outages (since if the Faster Payment fails, they just fail rather than retrying) but the way DDs work, a similar failure cannot occur from my understanding.
The only time a I’ve heard of that a DD would fail is if you don’t have sufficient funds to pay it. That seems very reasonable to me?
I will add that part of it is perspective. I lived in the US for a number of years. A country where banking is such a disaster and so messy that the most common way to transfer money between people is to write the order on a piece of paper (a cheque) and have the other person take photos of said order and send it to their bank… Every bank in Britain is doing so much better, that the idea of ‘if I don’t have money, my payment doesn’t go through’ seems to be an extremely minor complaint - to be honest, it seems logical to me that without money, a payment would fail.
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Depends on the fine print: If you don’t have sufficient funds by 11:59pm on the day of the DD, then by all means: It’s reasonable to fail. If you don’t have sufficient funds by 0.01am, then I don’t think it’s reasonable to fail. In reality all banks have their cut off times between those two extremes, and what is reasonable is certainly up to debate here, but it is my understanding that Monzo’s cut off time is very early in the morning, as they won’t retry the DD if you don’t have the funds by the usual processing time. In my personal opinion this is not reasonable.
Contrast with with Barclays, TSB, NatWest and Santander (and to my understanding most other UK banks, but I can talk from experience with these four, as I have accounts with them): They will retry the DD if you add money by some time in the afternoon (exact time varies, but between 3-8pm).
Customers in the UK generally expect this behaviour.
(At least Barclays and NatWest additionally allow you to sign up for alerts, so they send you a text in the morning if you don’t have sufficient funds for the day’s DDs with the suggestion to pay in sum by {insert time here} or else DD will fail. Surely if established banks can do this, then legacy banks with all their fancy pants analytics, real time notifications etc, can do that too!)
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Essentially we have been trained by ‘legacy’ banks that a direct debit is not returned until the afternoon even if no funds are available to give the customer chance to deposit funds.
I do know these legacy banks can also straight decline direct debits but tend to do this if the customer is in financial difficulties so as not to compound the issue. But then this could be debated in its own thread.
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I guess it’s a matter of perspective, but as far as I can see, a Direct Debit is an order for money to come out at an unspecified time on that date. To me, that means that a failure anytime after 00:00 on that date for non-sufficient funds is reasonable, as they can take it out any time on that date. In fact, until the Monzo Community, I had no idea other banks allowed it to be much later in the day!
Fair enough, but where is that in writing? My understanding is that the time of a DD is unspecified and therefore, it would seem reasonable that you should be expected to have funds by 00:00 on Direct Debit day.
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I can certainly see your point, and I also would always ensure that I have enough money for my DD in the account by the evening before because I don’t want to take chances. But the problem is that in the UK the custom is to have the deadline some time in the afternoon, and (at least some) legacy banks actually send you a notification on the day to pay in, if you don’t. Maybe Monzo is amazing compared to US banks, but in this aspect they compare miserably to UK banks.
I’m less interested in what’s reasonable. I don’t care what’s “right” or “wrong”, that’s all fuzzy arbitrary stuff 
. What gives the best experience for a user though? I think that “flexible” / “smart” timing of direct debits gives that
Edit: More context - I don’t really have any issue with what Monzo do now. I fully switched over back in October 
. I’m just trying to advocate for the best Monzo that Monzo can be 
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Again I will say I have had NO issues with ANY of my DD’s so I have no idea why people are… I think it’s because I have done the simplest of things such as request they come out a few days AFTER I get paid.
If people thought logically about things then there would be no issues 
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I don’t think that’s reasonable. Correct funds to pay by close of business is reasonable, as overdrafts don’t start charging until the end of the day. In your scenario, you could have a DD declined at 00:01, but by 23:59 (when the bank looks to see if you’re now ‘overdrawn’) you could be in credit. As banks take this last point in time as the account balance for the day, it would make no sense, when looking in retrospect, why the DD had been declined.
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I meant for Monzo 
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then we get an automatic alert to the relevant team to investigate. None of this is groundbreaking, earthshattering rocket science
I never said implementing a queue is rocket science. However, it’s one step above just processing the event directly and returning success/failure right away, which Monzo are doing at the moment, presumably to get a “minimum viable product” going for direct debits. Personally I’d rather have DD’s that don’t retry than no DD’s at all - the former is just an annoyance, the latter would defeat the whole point of a current account.
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Yes, but firstly this was bout the assumption of retries being more difficult in an event driven architecture, which is simply not the case. Secondly, my argument was that it’s an extremely poor design design choice to implement a third-party-dependent system in a way that doesn’t allow for failure/retry. This is not an MVP, at best it’s a Proof of Concept.
Additionally it goes back to what I said in the original post:
Sure: non-retry DD are better than no DD at all, but they are still not good enough for what’s supposed to be a finished product.
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Totally agree with this. Anyone who has any level of experience dealing with the architectural design of disparate asynchronous systems knows that failure is something to be expected and designed for. Back in the day Netflix were the trailblazers of this approach with their Chaos Monkey work.
More on topic, and architectural issues aside, I believe Monzo’s current approach to DD handling (and SOs which are worse given the architectural design issues in not dealing with failure) is fundamentally flawed and a real blocker to it becoming my main account, and I suspect for many other people.
Even an approach where DDs were processed once much later in the day would be better than what we have now.
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What is the ‘fundamental flaw’? They take the money out on the day they say they will. That doesn’t seem like any type of fundamental flaw…
It may not be the time people prefer, but it does what it says on the tin - Direct Debits X amount on Y date.
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Not what you want to see when you open the app…
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Surely it’s up to people to make sure they have enough money in the account for the day the DD comes out? Which is why mine are always after pay day
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