Egg BT Fee Official Line

Sounds like they need to get their customer services in line

Just received the dreaded email this morning-no mention of a fee for anniversary period.

sicker wrote:

My email states changes come into effect on May 1st so I am assuming my transfer on April 1st will be fee free (2004 card) Fingures xxxxxxxxxxx'd

John

Yeah you should be fine.

I think Egg will be seeing en-mass cancellations in the next few weeks, especially from people who also have an egg money card (which is worth retaining).

Now that the fee is applicable to all, its about bloomin time that credit card providers were banned from advertising balance transfers as being 0%, but with a * pointing to rubbish BT fees in the small print.

It would be interesting to see a calculation of the actual cost of a 0% anniversary offer for 5months now, given the uncapped fee and the interest accrued on that fee over the 5months at standard APR.

EDIT: Here goes, first of all my assumptions:
1) Anniversary BT done on 1st day of the month.
2) Paid off in full on last day of 5month offer (by transfer to another credit card or with debit card) (NOTE: not a good idea cutting it so fine, given clearing times etc).
3) Minimum payments made during 5 month anniversary deal.
4) BT Fee accrues interest at 15.9% APR

On a £10k anniversary deal, you'd pay a £250 fee which would accrue £16.55 in interest over the 5months. So the actual cost is 2.66% of the original transfer. I reckon that works out as an effective APR of 6.4% (looks like smitty came up with similar figure below), and thats assuming you pay it off at the end of the '0%'.

Conclusion: there are far cheaper ways of getting credit balances switched, RIP egg!

Paying an instant 2.5% on a 5 month deal is eqivalent to 6% Apr. The OFT should clamp down on this sly, underhand use of '0%' once you have paid a 6% Apr fee up front.
J_B. (The FSA do not regulate credit cards but the OFT does, AFAIK.)

When you get the email (got mine last night) it links to this page for more specifics:

http://www.egg.com/visitor/0,,3_60374--View_1124,00.html

Now go down to where it says:

Summary of changes which come into effect on
1 May 2006 to Egg Card:

If you'd rather take a look at a summarised form of the
changes to your Egg Card Conditions, these are shown

below.

Now go down to Condition bullet 7.2':

Condition 7.2 bullet

Old


a handling fee of 2% (maximum fee £50.00) on the
amount of each Transferred Balance made during
an introductory offer period or made under a
Special Promotion;

New


a handling fee of 2.5% on the amount of each
Transferred Balance made during an introductory
offer period or made under a Special Promotion;



To me that's quite clear - the 'new' 2.5% uncapped fee only applies on the two occasions where the 'old' 2% capped at £50 fee previously applied.

1) If you have a May 2006 or later Egg card and you take advantage of their 0% for 9 months 'introductory' offer - that will cost you 2.5% of whatever you transfer. (IF you've already used this offer in the past it either cost you nothing or a max of £50 at the time)

2) If you have any sort of Egg card then you must just watch out for 'Special Promotions' from now on. These will be 'uncapped'. But provided you don't transfer whenever a 'Special Promotion' is applying (the safest time is the month immediately following one!) you'll be safe and won't be charged any fee.