Dormant credit card charges - Egg, Lloyds, Santandar, Amex

Dan29

Can't find anything about this already posted but according to this article the following are introducing charges for not using your card, or in the case of Egg, not using it or using it and paying off in full:

"American Express - £20 Fee if card not used during past 12 months
Abbey - £10 Charge if not used during past 6 months
LLoyds TSB - £35 Fee if card not used during past 6 months
Santandar - £10 fee if card not used during past 12 months.
Egg - 50p monthly fee if no interest paid, which implies that it will also hit Egg customers that clear their monthly balance. Also have now cancelled cash back on their card."

Cell

I put a £4.49 CD through on my AMEX just to make sure I didn't fall foul of it. Am paying off a life of balance transfer, but this won't really muck anything up even though I'd rather not spend on the card.

BigDave81

Hopefully it won't follow to Virgin, Barclaycard, Nationwide and Mint as I never use those but keep them 'just in case'.

marksoton

Sorry but all these fees are easily avoidable. Why not just put a purchase on them once every couple of months and pay in full.

For the piece of mind of having a relatively substantial emergency fund to hand should one need it is surely worth it ?

Mayday

I've started using my credit card/s instead of a debit card when doing the supermarket shop - then an online bank transfer for equal amount to credit card account.

Funnily enough, it was the cashier in Lloyds that advised this months ago "as did I realise that I had more cover with a credit card than a debit card?"

anna42hmr

marksoton wrote: »

Sorry but all these fees are easily avoidable. Why not just put a purchase on them once every couple of months and pay in full.

For the piece of mind of having a relatively substantial emergency fund to hand should one need it is surely worth it ?

thats what i have started to do with the less used cards that i have,

i am even obsessive enough to have a word document with a table with each card i have on the top and months down the side and when i have used a card just put a star in that month so i can see easily if i have not used a particular card for say 4 months so i know i need to use it for something just in case (as santander for instance is 6months none usage etc which seems to be the shortest period) and i have full balence direct debits set up for all of them in case of use apart from the one on 0%. (just remember though dd's are only valid for 13 months of none use also so if a dd has not been used for that period of time, it may be rejected by your own bank)

Grade_A_Reject

Dan29 wrote: »

Egg - 50p monthly fee if no interest paid, which implies that it will also hit Egg customers that clear their monthly balance. Also have now cancelled cash back on their card."

The wording in the Egg T&C's reads :-

"a top-up fee where the amount of interest charged to your Account on any statement is less than 50p and the fee will be the amount required to make the top-up fee plus that interest equal to 50p. Where this applies, your statement will show a 50p minimum finance charge. Any top-up fee will be treated as interest for the purposes of calculating the minimum payment. Interest will be charged on the top-up fee at the standard variable annual rate applicable to Purchases."

This is a minimum finance charge where interest is payable but the amount due is under 50p. In these circumstances they round up the interest to 50p. This doesn't affect customers who pay off the balance in full each month.

Egg are also still paying cashback on the Egg Money card at 1%. There is a monthly charge for the card of £1 but this doesn't apply to holders who have had the card since before 14th July 2009.

Moggles_2

Grade_A_Reject wrote: »

Egg T&Cs reads :-"a top-up fee where the amount of interest charged to your account on any statement is less than 50p and the fee will be the amount required to make the top-up fee plus that interest equal to 50p...." This is a minimum finance charge where interest is payable but the amount due is under 50p. In these circumstances they round up the interest to 50p. This doesn't affect customers who pay off the balance in full each month.

Absolutely. The article quoted is misleading.
Other providers (eg. Bank of Scotland) have a minimum finance charge of 50p as well.

jakesuk

Grade_A_Reject wrote: »

Egg are also still paying cashback on the Egg Money card at 1%. There is a monthly charge for the card of £1 but this doesn't apply to holders who have had the card since before 14th July 2004.

I have had an Egg Money / World Mastercard since October 2008 and I am not being charged the £1 monthly fee (and I do receive 1% cashback).

Grade_A_Reject

jakesuk wrote: »

I have had an Egg Money / World Mastercard since October 2008 and I am not being charged the £1 monthly fee (and I do receive 1% cashback).

Apologies. That was a typo on my part. It should have said 2009.

Their T&C's read:-

7.2 We will charge:

a monthly fee of £1 (not applicable to customers who applied before 14 July 2009)

Paulgonnabedebtfree

Dan29 wrote: »

Can't find anything about this already posted but according to this article the following are introducing charges for not using your card, or in the case of Egg, not using it or using it and paying off in full:

"American Express - £20 Fee if card not used during past 12 months
Abbey - £10 Charge if not used during past 6 months
LLoyds TSB - £35 Fee if card not used during past 6 months
Santandar - £10 fee if card not used during past 12 months.
Egg - 50p monthly fee if no interest paid, which implies that it will also hit Egg customers that clear their monthly balance. Also have now cancelled cash back on their card."

I'm wondering what a more precise definition of "not used" is.
I have decent LOB deals with a couple of those cards listed. I have little choice but to regard it as long term borrowings as I'm only making extra payments to my higher interest debts. I don't used the cards with LOB deals for purchases as that would trap debt at a higher rate because it gets paid off AFTER LOB deals. However, each month they get the minimum payment from me and there is an interest charge.
Now if they are going to play silly bug gers and start charging me for not making any purchases, I will play silly bug gers and go into a supermarket every few months and buy a Mars Bar or similar with a credit card (large supermarkets are more flexible about small purchases witrh a CC).
Of course, they may count the interest charge and minimum payment as "usage" in which case no problem.