0% Balance Transfer Card May Be Charged for Dormancy Fee, Waht to do?????

yuyu_2

Hi,

I have just received a new terms and conditions leaflet from Abbey's credit card. One of the new terms is "We may charge you a dormancey fee if you do not use your card for 6 months."

The credit card is 0% balance transfer for 12 months.

We all know we should not use the Balance transfer card as the spending will be paid off the last.

Now they seem to force us to use the card. So what shall we do? Any way round it?

yuyu

Moggles_2

Unless the balance on your Abbey card is zero, your account is not dormant.

ICan'tStandIt

If you have a balance and making regular payments then it shouldn't be seen as a dormant account.

Although a BT is not a purchase, it is still a transaction and you have still "used" the account.

I think you should be fine.

yuyu_2

Is minimum payment by DD considered as "Transaction"? Here is another term by Abbey Credit Card: " We are also introducing a new 10pound fee which we may charge if you have no transaction or a zero balance on your account for 6 consecutive months."

YorkshireBoy

yuyu wrote: »

Is minimum payment by DD considered as "Transaction"?

If you have the product you'll find their definition of "transaction" in your T&C's...

"Transaction" means a Balance Transfer, Cash Transaction, Purchase or payment by Credit Card Cheque and any other transaction made by you or an additional cardholder on the Account.

The words in italics all describe outgoing payments, although the "any other transaction" wording may be open to interpretation?

NickX

yuyu wrote: »

We all know we should not use the Balance transfer card as the spending will be paid off the last.

The revised Terms and Conditions do not make it clear whether simply making the Minimum Payment will count as a transaction to avoid the £10 dormancy fee.

However, the Abbey Zero card offers 0% on Balance Transfers and Purchases for 6 months. Because the two promotions are for identical periods of time, there is no problem spending on the Balance Transfer card, so I will make a small purchase on the card just to be on the safe side.

If you go abroad it may be useful because it offers commission free foreign currency transactions.

m00head

I have also received the same letter from Abbey containing the updated T&Cs with the introduction of the £10 six month dormancy fee.

I don't think they will class an account with a non-zero balance and a minimum DD payment going out every month as dormant. Just have to make sure you cancel it at the end if you are using it for stoozing.

Looks like they are the latest in a line of banks who have introduced a dormancy fee, including Lloyds TSB with a £35 fee and Barclays with a £20 fee.

Egg and Barclays have also cancelled some customers accounts that are dormant or not profitable for them. MBNA now charge £10 for balances in credit according to the following article:

Barclaycard to charge £20 fee | This is Money
http://www.thisismoney.co.uk/credit-and-loans/article.html?in_article_id=420635&in_page_id=9

Are there any other banks that have started charging fees for dormant accounts?

Moggles_2

yuyu wrote: »

Is minimum payment by DD considered as "Transaction"? Here is another term by Abbey Credit Card: " We are also introducing a new 10pound fee which we may charge if you have no transaction or a zero balance on your account for 6 consecutive months."

I think you're worrying unnecessarily.

If you've transferred a balance from another credit card, in order to take advantage of 12 months 0% on BTs, that balance transfer transaction remains on your Abbey a/c for 12 months (or as long as it takes to pay it back.) Therefore, there's no possibility of having "no transaction on your account for 6 consecutive months or a zero balance"

The term dormant means unused. This fee is a cost-cutting measure aimed at customers who do not use their card.

Moggles_2

m00head wrote: »

Looks like they are the latest in a line of banks who have introduced a dormancy fee, including Lloyds TSB with a £35 fee and Barclays with a £20 fee.

Did Barclaycard go ahead with this then? I thought the idea was shelved.

That said, Goldfish introduced a fee on Morgan Stanley cards (other than the platinum cashback version.) Having taken over the operation, Barclaycard looks set to continue with the charge.

anydiscount

The Abbey Zero Credit Card which started this thread actually states "We may charge you a dormancy fee if you do not use your Card for 6 months".
Thus the responses stating that paying some money off each month is a transaction don't really have any relevance here since it is use of the card that matters.

This does seem a real shame since it would be nice to keep the Abbey card as a backup to my Nationwide card for trips abroad (no foreign tranaction fess). I realise that you only have to make 1 minimum puchase in a 6 month period to avoid the fee, but it does seem to be an example of credit card companies hitting back with new fees.

I remember the good old days when credit card companies actually paid us to transfer our balance to them. Now we pay a 3% fee, though not in the case of this Abbey card. How times have changed.