COVID-19 Debitsuccess Q & A

Updated April 20, 2020

Will our members contracts be extended?
Yes, all contracts will be automatically extended.
For example, if a member signed a 12-month contract on 1 Jan 2020, and the shutdown lasts for two months, their contract will now end on 1 March 2021.
This means the total contract value does not change either. So, if they pay $60 per month, the total contract value would still amount to $720 (i.e. $60 x 12).

What about members who suspended their contracts before the shutdown?
If a member suspended their membership before 23 March 2020 (for whatever reason) and their suspension end date is AFTER your reopen date, then the original suspension date still stands.
Alternatively, if their suspension is due to end BEFORE your reopen date, their membership will be automatically activated that day.

Could our members first debit amount be different to their normal amount?
Yes. When your business reopens, some members may be charged more than their regular debit amount on their first payment.
This could be due to one or more of the following:

  • Pro-rata membership fees
  • One-off fees
  • Debitsuccess admin fees (which you may be passing on to your members)
  • Suspension fees that members opted in for (collected in arrears, not pro-rata)
  • Any overdue fees they may still owe

On the flip side, some members’ first payment may be lower than their regular amount. This will occur if they were in credit before shutdown.

We suspended our members’ accounts manually via the Debitsuccess self-service portal. Will these be unsuspended automatically?
No, you will need to end the suspensions manually too, via our portal.

When will we receive the 10% holdback?
If your business is permitted to open again on or before 11 May 2020 (45 days from initial hold back), we will be releasing all holdbacks owing within 14 days of the reopen date. However, please remember that you may not receive the full 10% back if some chargebacks have been processed.

If the shutdown is still in place after 11 May 2020, we will review your business’ chargeback and refund activity – with a view to release funds owed by 25 May 2020.

Will our members be contacted?
It is our recommendation that you contact your members with the date you will reopen and when payments will continue.



Updated April 1, 2020


Why was 10% of our payouts held back last week (week ending 27 March)?

Given that membership fees are charged in advance, a portion of the fees we paid out during last week (week ending 27 March) were for services you may not be able to deliver for the time being.

And in our view, NZ consumer legislation prevents businesses from taking payments for services when there are reasonable grounds to believe the services won’t be supplied. In our situation, “services” are defined in the customer T&C’s as an entitlement to use the facility, which customers are unable to do during the lockdown period.

This means that members that have not opted into any new services,  may be entitled to a refund on fees already paid or, alternatively, they could request a chargeback down the track.

In normal circumstances, we would simply deduct chargebacks from the next payout. However, given that we don’t know when your next payout will be, we need to hold back 10% of the funds currently held to ensure that we can pay any potential chargebacks that may occur.

Will we eventually receive the 10% that has been held back?

The amount received will vary on a case by case basis. In other words, if your gym receives no chargebacks, you will get the full amount back. If there are chargebacks, these will be deducted from the 10% held and you will receive the residual amount left over.

Debitsuccess will continue to monitor your gym’s chargebacks over the coming weeks and months. Once we have a clearer idea of how many chargebacks your members are claiming, we’ll be in a better position to tell you exactly how much you can expect to receive back and when you will receive this.



Can we charge suspension or freeze fees?

No. You are unable to charge these fees during the time that your business is closed. The suspension is not member initiated but imposed due to government restrictions. To enforce a provision in an agreement that doesn’t exist, would in our view be a breach of the Fair Trading Act (and potentially other consumer legislation). However, you will be able to charge these fees if you are continuing to provide a service and your members ‘opt in’ to being charged such fees.

Can we continue to charge membership fees while our business is closed?

Yes, you can. However, your members must ‘opt in’ before you can continue charging them. They need to do this via email.

As mentioned above, the customer T&C’s define “services” as an entitlement to use the facility, which customers are clearly unable to do during the lockdown period. Any unilaterally imposed requirement to pay for services that are not being provided would, in our view, constitute a breach of the Fair Trading Act 1986.

Can we ask our members to ‘opt out’ instead of ‘opt in’?

No. This is because your members are receiving a different service to what they initially signed up for. And they must formally agree to this new service and its related fees before being charged for it.

Is a verbal ‘opt-in’ enough?

No, your members must ‘opt in’ via email.

This process is no different to the one you have always followed when signing up new members to your gym. It protects your business should a member change their mind or claim they never agreed to be charged.

Obtaining ‘written’ consent is a matter of evidentiary protection for your business and Debitsuccess.

How do our members opt in for us to continue charging them?

You’ll need to send an email to all your members asking them to respond if they are happy with the new service and related fee.

Please ask them to use the following wording in their email response:

Same fee I agree for you to continue deducting the current amounts being deducted at the current frequency, using my existing direct debit authority.
Reduced feeI agree to a variation to my existing direct debit authority and authorise you to deduct [$X] from my account amount per [week/fortnight/month] for the service described above.


 What do we do once we receive an ‘opt in’ email from our members?

Please forward each email to as soon as possible.

Our team will then charge the member the fee stipulated in the email at the agreed frequency.

Can we continue collecting overdue membership fees that were due before 24 March?

Yes. This is the default position for all our clients (unless you have arrived at a different arrangement with your Account Manager).

Will you be holding back a percentage of future payouts?

We will continue to monitor chargebacks and we will be in contact with you to discuss options in the event the chargeback risk increases.



If a member cancels and is out of contract, can we take 10 days payment in line with their membership agreement?

No. As the gym is closed, the member has no option to visit the gym during that period.

Can we charge a one-off cancellation fee and cancel the member straight away?  

Yes – but only if the terms and conditions in your membership agreement cater for this.



Are the Debitsuccess Account Managers still working?

Yes. They’re all working from home and responding to emails as fast as they can. We appreciate and thank you for your patience during this especially busy period.

Is the Debitsuccess Contact Centre still operating?

Yes. Our Contact Centre team members are all also operating from home. This means they’re not able to make or take phone calls for the time being. But they’re responding to emails as fast as they can.


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