direct debit

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A form of standing order given to a bank by an account holder to pay regular amounts from a cheque account to a third party. Unlike a normal standing order, however, the amount to be paid is not specified; the account holder trusts the third party to claim an appropriate sum from the bank. The amount to be paid can be varied. In the USA this arrangement is known as reverse wire transfer.

Subjects: Financial Institutions and Services.

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