A debit date is the calendar date on which a payment is scheduled to be automatically deducted from an account, which is typically a checking or savings account. The debit date can be set for any time of the month, either by the payer of the bill or by the creditor or company that is receiving the payment.
The types of companies that can institute a debit date vary. Typically, a direct debit from an individual’s account is an agreement between the account holder and the biller. Two of the most common debit dates are the first and the 15th day of the month.
A direct debit may be connected with anything from a credit card or electric bill payment to child support and alimony payments. In some cases, the account holder is permitted to choose the debit date, while in other cases the company debiting the money tells the account holder when the debit date will be.
Establishing a debit date can be a convenience for an account holder. Instead of having to worry about when to pay bills or the act of sitting down to write out checks and mail bills, account holders can have all sorts of payments directly debited from their account.
Online bill pay also permits account holders to establish the debit date for when they want a bill payment to reach the creditor. In this situation, it allows the account holder to sit down once a month and schedule out their bills at one time. With an online bill pay system, which is through the bank of the account holder, the account holder can schedule the debit date for each of their bills to be paid for the entire month.
Since an account holder may or may not have control over the debit date, it is important to monitor the balance in the account. This ensures that there is always enough money to cover the direct debit. Some companies even offer discounts on rates to those clients that choose a direct debit option from their account.
Some companies even allow account holders to split monthly payments in two by separating the deductions into two different dates to debit the account. For example, a car insurance company may set a date to debit the account or half of the car insurance payment for the first day of the month. The company may then set the second debit date for the 15th of the month.