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Customer Recourse

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The GoCardless content team comprises a group of subject-matter experts in multiple fields from across GoCardless. The authors and reviewers work in the sales, marketing, legal, and finance departments. All have in-depth knowledge and experience in various aspects of payment scheme technology and the operating rules applicable to each. The team holds expertise in the well-established payment schemes such as UK Direct Debit, the European SEPA scheme, and the US ACH scheme, as well as in schemes operating in Scandinavia, Australia, and New Zealand. See full bio

Last editedJun 20241 min read

In this section, we look at customer recourse.

Customer recourse and refunds

Under ACSS rules, customers can request a refund for Pre-Authorized Debit payments in certain circumstances. It’s important to understand this process, although in reality only a very low percentage of payments receive refund requests.

Each Pre-Authorized Debit agreement must include a recourse statement. This tells the customer about their recourse rights if a payment is not compliant.

A customer can claim reimbursement under the following circumstances:

Payment was not taken in accordance with the agreement
The customer revoked the Pre-Authorized Debit agreement
The customer did not receive appropriate confirmation or notification before payment was taken

The reimbursement rules differ depending on whether the claim is coming from a business customers or an individual. If the former, they must claim within 10 business days. If the latter, they must claim within 90 calendar days of the date the payment left their account.

In addition, the customer’s bank may require them to submit a reimbursement claim. Under ACSS rules, the customer’s bank must reimburse the customer for the amount of the claim and return the Pre-Authorized Debit. If your organisation disputes the claim, both you and the customer will need to address the issue outside of ACSS rules.

For Cash Management PADs and Funds Transfer PADs, banks aren’t required to provide recourse, except where a PAD agreement doesn’t exist. Despite this, the customer’s bank may choose to provide recourse anyway.