What is Standing Order?

Full Definition

A standing order is an instruction a customer gives directly to their own bank to pay a fixed, pre-set amount to a specified recipient at regular intervals -- weekly, monthly or another chosen frequency -- continuing automatically until the customer cancels it or the instruction reaches its end date. Standing orders are commonly used for payments where the amount does not change, such as rent to a landlord, a regular transfer into a savings account or ISA, or sending an agreed sum to a family member, in contrast to a Direct Debit, which is set up by the recipient (the biller) and can vary in amount from payment to payment, such as a utility bill that differs each month. Because the customer, not the recipient, controls a standing order, it offers less flexibility for the payee if the required amount needs to change, but it also carries none of the Direct Debit Guarantee protections, since those specifically cover Direct Debits rather than standing orders; a wrongly set-up or duplicated standing order is the customer's own responsibility to spot and correct with their bank. Standing orders in the UK are typically processed through the BACS or Faster Payments systems depending on the bank, and most banks let customers set up, amend or cancel a standing order instantly through online or mobile banking.

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