Termination of credit card account

deza

I received a letter from Barclaycard recently:

Following a review of our existing accounts, the decision has been taken to withdraw your Barclaycard credit facility. This decision was taken due to the fact that your account does not meet the organisations [sic] new assessment criteria. Unfortunately I am unable to discuss in any detail the criteria concerned with your closure as it is company information and as such is confidential.

I was quite surprised, to say the least! Is there any way how I can find out why this decision was taken? I am not really bothered to get them to change their mind, but I am curious why they've done this out of the blue? I've made a late payment on perhaps two occassions, but apart from that my business with them is always in good order.

Surely the bit they write about "not being able to discuss in detail" can't be right? I was as much party to this credit agreement as what they were, and as such I should have a right to such information, no?
Will this have any impact on my general credit rating?

[Deleted User]

Ask yourself this:

Do you pay the balance in full each month?

If so, you arent making them any money

Do you have alot of other credit facilities (cards) with availible credit or at limit?

If so, you may be seen as a risk to them

YorkshireBoy

Supercharge_Me wrote: »

Do you pay the balance in full each month?

If so, you arent making them any money

Assume:

£2,000 credit limit
£1,000 monthly spend
£1,500 average balance
1.5% merchant fees

Fees income:

£1,000 x 0.15 x 12 = £180

Profit:

£180 return on £1,500 'risk' is a 12% gross profit...and of course there's always the chance of a bit of interest and the odd late payment or two.

rodent

.................

DipStick

deza, speculate for us - why do you think they might have terminated this card?

Have you got lots of debt elsewhere?
Lots of other cards?
CCJs?
Tried to reclaim bank or CC charges?
Don't use the card?
Someone else has used the card fraudulently?
Etc, etc, etc.

It could be any one of dozens of reasons. What do you reckon it could be?

[Deleted User]

YorkshireBoy wrote: »

Assume:

£2,000 credit limit
£1,000 monthly spend
£1,500 average balance
1.5% merchant fees

Fees income:

£1,000 x 0.15 x 12 = £180

Profit:

£180 return on £1,500 'risk' is a 12% gross profit...and of course there's always the chance of a bit of interest and the odd late payment or two.

Well assuming is not really very good..

If you pay off the balance every month, and your monthly spend is £1000, how can the average balance be £1500?

NickX

Supercharge_Me wrote: »

Well assuming is not really very good..

If you pay off the balance every month, and your monthly spend is £1000, how can the average balance be £1500?

Hmmm, YorkshireBoy is the most experienced person in the field of Credit Cards that I know.

He is quite correct in that if your monthly spend is £1000, then your balance is likely to fluctuate between £1000 and £2000 allowing for the time provided to settle the card in full (up to 59 days interest free credit remember). On this basis the average balance is likely to be around £1500.

There is no problem with YB's assumptions, it is merely a hypothetical example.

[Deleted User]

Meh if you say so, still, £180 is hardly going to touch the sides on the write off sheets.

YorkshireBoy

Supercharge_Me wrote: »

Meh if you say so, still, £180 is hardly going to touch the sides on the write off sheets.

Write off sheets?

...and £180 is not the important figure. 12% gross profit (as a minimum) is.

[Deleted User]

"YorkshireBoy is the most experienced person in the field of Credit Cards that I know."

Surely you must know that companies have to write off debts due to case of fraud, or if a customer dies and has no estate.

What im suggesting is that £180 is nothing given that the average customer doesnt not pay off their balance each month, Credit card companies will look for a much higher return than just Merchant Fees.

PBA

Note that OP hasn't replied, so we've got no way of knowing how much gets spent on this card each month, or how much he repays.

If Barclaycard have decided they no longer want to do business with you, then that's there decision and there's alone. They don't owe you any explanation.