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Is mystery Paypal fee a ‘continuous payment authority’?

QMaurice Griffiths’ case in Issue 603 about Paypal taking £4.99 per month out of his bank account caught my eye. There may be another explanation, unrelated to his having a Paypal account. Paypal provides merchant services to businesses, which allows them to accept debit and credit card payments. Even if you don’t have a Paypal account, transactions show up on your bank account as a Paypal charge. Could this possibly be the reason? Rob Mackean

ARob may be on to something here. Certainly, the amount being taken each month isn’t the £9-a-year ‘inactivity fee’ it’s charging people for not using their account (this was introduced last December: www. snipca.com/37614). It does sound more like what’s called a continuous payment authority, which is a type of recurring payment for a service or subscription, using a person’s debit- or credit-card details. They are slightly different to direct debits because they give companies more freedom about when and how they take money from you.

As the Financial Conduct Authority explains ( www.snipca.com/37950), you have the right to cancel a payment at any time. The problem is that you may not know who’s actually taking your money. If Maurice doesn’t know who this is, he should instead ask Paypal to find out, and then decide whether to ask it to cancel the payment.

Maurice needs to let his bank know he’s disputing the charges because he may be able to recoup some of the money if he’s been defrauded. If neither Paypal or his bank will help, he should ask the Financial Ombudsman ( www. financial-ombudsman.org.uk) to investigate. CASE ONGOING