How do you handle the merging of bank accounts within one of the World’s largest banking corporations (Barclays Bank PLC)?
Well if you are Paypal, you cancel all subscription payments on the accounts linked to Barclays in a major banking snafu.
This won’t interest many of my US readers unless I happen to be one of your customers, though something similar could happen to your Paypal subscriptions wherever you are located.
Here is a timeline…
Barclays Bank (UK) Buy Woolwich Building Society
This actually happened I believe over a year ago. They were both being run as separate entities thus nothing drastic to worry about.
May 2007 High Street Consolidation & Bank Account Notice
I am not sure how much of this has happened, I haven’t actually been back in the UK for almost a year but I assume that there is some consolidation of the retail outlets.
There was a notification of bank accounts being transferred over sometime towards the end of July, but no specific details regarding direct debits that I am aware of.
July 10th Through July 21st Bank Account Merger
Letters start being sent regarding the merger of bank accounts.
I get all business correspondence scanned and sent through to me near enough the day it arrives in the post box. The first letter, dated 10th July arrives in my email 21st July
This allows me to set up my internet banking on the new account
July 31st 2007 All Paypal Subscriptions Cancelled
I had multiple bank accounts and credit cards attached to my Paypal account, but because the bank account that was still listed as being the primary account was closed, Paypal decided to cancel all my subscriptions.
I also received the following email from Paypal
The mandate from your bank account, ending in 6313, was returned by your bank on 31 Jul. 2007 for the reason below:
The bank account is closed.
Please do not reply to this email. This mailbox is not monitored and you will not receive a response. For assistance, log in to your PayPal account and click the Help link located in the top right corner of any PayPal page.
Am I to blame? I am not sure, but from the evidence I have collected, the blame squarely rests on Woolwich / Barclays or Paypal.
It seems logical to me that the ideal way for this situation to be handled would be an authorization request of some kind to transfer bank mandates to the new account by Barclays or they should do it without any needed authorization.
Alternatively Paypal could have notified me that they were changing my primary account over to a different account, because they had received notification on my primary account being cancelled.
I am not sure even if I had thought of changing over my primary bank account in Paypal, whether the secondary funding source for each subscription would have been transferred over as well.
Bank Mandates Were Meant To Be Transferred
Referring to the changes documents
To save time we’ve transferred over all your current bill payment mandates.
Further down the page it states…
We have moved all of your Direct Debits across to your new account and notified the companies concerned but because these are new Direct Debits they will not have any of the additional information, such as the last payment amount and last payment date. Once the Direct Debit has been claimed from your new account the details can be viewed in ‘Change Payments’ â€“ accessed from the ‘All Payment Options’ link in the left-hand menu of your homepage.
As far as I am concerned, Barclays and Paypal are to blame for this mistake, but it is certainly going to cost me a great deal of time, and potentially cost businesses a lot of lost subscriptions.
I will most likely spend the remainder of today on the telephone trying to get through to Paypal, and contacting each of the sites I had subscriptions with explaining that I didn’t request a cancellation.
Fortunately I have a lot less subscriptions currently than I had in the past, but this situation is still going to take time to clear up.
How Much Can This Cost Your Business In Both $$$ and Time?
Major bank mergers don’t happen every day, but how many of your subscribers are paying using Paypal, and how many of them would go to the trouble of renewing subscriptions that are cancelled en mass.
Judging by the difficulty I am having reaching Paypal on the phone, this might be a major snafu. Woolwich / Barclays have millions of customers, and they have all just had their Paypal subscriptions cancelled.
Membership Sites on Autopilot?
There is lots of talk about the profitability of membership sites running on autopilot. How would your membership site business handle 20% of your subscribers with subscription cancellations overnight?