[Sigia-l] Best Practices for Recurring Payments

[John O'Donovan]

I can't give you a URL because this was for an application that is not web
based. Don't hold it against me though...

Some examples from a system with financial and contracts management elements
that I worked on. Contracts management is admittedly more complex than the
requirements for the average bank user, but this may help anyway.

1) On a certain day each month / every three months / 6 months / yearly
(roll backwards to Friday if date is on Saturday, Roll forwards to Monday if
date is on a Sunday, Roll forward over Bank Holidays or at discretion)

2) Last day of month / first day of month
(pay on the 1st  or last day in the month fixed)

3) With a pattern each week
(Mon, Tues and Thurs of every week)

4) In a certain number of days
(pay the bill in 30 days)

5) On a certain date
(pay up on the 30/12/2004)

6) On a trigger event
(I've been paid - pay my debts, criteria for contract completion is up - pay
up)

7) On a trigger value
(I have x pounds - pay x to this person)

8) Staggered payments
(pay 40% on this date, then the remainder on completion)

You will generally find that one off payments can be on any day but
recurring payments are fixed to a date each month. If you try to do it every
x number of days it gets complicated and you will find that the payment date
slips and moves about. Monthly payments are not the same as every 30 days
and should also never slip across month boundaries.

I have not used fortnightly payments, either in a system or as a consumer
though there may be uses for it.

The trigger value is becoming more popular for scraping - that is:
"at the end of the month take x surplus pounds from my current account and
move it to my savings account so that I don't spend it all"

Also I have not seen banks implement this, but the trigger event would be
particularly useful for making sure you don't pay bills until you have been
paid . Business does work this way - you don't pay sub contractors and
distribute payments until you are paid, so this may be relevant for business
accounts.

Cheers,

jod


----- Original Message -----
From: "Jeff Lash" <jeff at jefflash.com>
To: "SIGIA" <sigia-l at asis.org>
Sent: Tuesday, March 11, 2003 12:40 AM
Subject: [Sigia-l] Best Practices for Recurring Payments


> Jess not-so-subtly mentioned:
> > I had hopes that I could look back on the list
> > at the end of this week, and see some real shop talk,
> > as Marc Rettig encouraged
>
> Well, I'm more than happy to oblige.
>
> Has anyone had any experience designing a system to set up recurring
> payments? What was your solution? Is it a public-viewable URL that you'd
> like to share?
>
> Just to make sure everyone's on the same page, I'm talking about a system
> where, for example, you can set up your mortgage payment to automatically
be
> deducted from your bank account on the same day every month, or have your
> gym membership automatically charged to your credit card on a regular
basis.
>
> I'm especially curious to see how others dealt with issues like:
> - Do you allow users to specify the day of the month (i.e. 15th of every
> month) or only pick the recurrence (i.e. once a month)? How do you deal
with
> users picking 29/30/31 of the month, since those dates obviously don't
occur
> every month? What about if they choose a weekend date (since financial
> institutions usually don't process on non-business days)?
> - What about setting up payments for more frequently (several times a
month)
> or less frequently (once every six months, or once a year)? How much
control
> does the user have in choosing the date and schedule?
>
> [I've got some ideas, but I'm curious to see what others have done.]
>
> I'd prefer answers along the lines of "Here's the URL of something I
worked
> on" rather than "Here's the URL of the bank that I use," in keeping with
> recent comments on the list, but any suggestions are appreciated.
>
> Jeff
>
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