Small balance write off

calleyw

Has anyone heard of these before.

As I bought some items from a well know on-line website. And after vouchers etc had been taken in to account I owed 83p which was charged to my cc. I also was happy to pay it.

Got a statement and it say small balance write off 0.83- and my balance is now zero.

Is it standard to do this. Anyone else had this.


Very very strange.


Yours


Calley

Chadsman

I have had this before with Halifax.

If the debt is small it costs the card co. more to process the payment than the payment is actually for so they make a pragmatic decision and write off the debt.
:beer:

calleyw

Chadsman wrote:

I have had this before with Halifax.

If the debt is small it costs the card co. more to process the payment than the payment is actually for so they make a pragmatic decision and write off the debt.
:beer:

That is what I guessed it was for.

So I assume that any transactions under a £1 would be treated the same. Anyone know.


Yours


Calley

kuohu

So you could fill your boots ordering things less than a pound then?

Sounds interesting! What was the site? Please.

chirpy007

I had a balance of 30p written off

Mikeyorks

A lot of companies operate an (unpublished) de-minimis limit, at a level where it is administratively uneconomic to collect an outstanding sum. It's factored into the software - and it probably also checks that it's not actioned several times on the same account. To prevent knowledgeable 'abuse'.

But I've never seen it on a CC, where they issue a Statement in any event - so that forms a lot of their Admin cost?

So you could fill your boots ordering things less than a pound then?

Sounds interesting! What was the site?

.......think you've missed the point? It was the CC not the retail site, that wrote off the small 'debt'.

calleyw

Mikeyorks wrote:

But I've never seen it on a CC, where they issue a Statement in any event - so that forms a lot of their Admin cost?

I thought it was strange that they issued a statement to tell me that they had written off the balance. And I had a zero balance.

But of course I will not get a statement next month as I will not be spending on the cc again next month.

What do you reckon about £10 in admin costs by the time they had printed, got someone to stuff the envelope and the post cost.

Madness, pure madness. But the funny thing was I was happy to pay 83p as well.


Yours


Calley

Milarky

It seems to work only with RBS credit cards. Spend less than £1 (or as the OP notes be left with a balance of less than £1) and the amount is written off. With Tesco and Mint it is '99p' but with Natwest (a new card that I am experimenting with after its 0% period ended) it worked first time with '49p' being written off but did not write off an engineered '99p' balance. If it writes off 49p this month I shall move it up to '50p' etc.

As for Halifax - that's interesting. When I found out this happened with RBS I tried leaving 99p on all my odd cards - but only Tesco and Mint took the bait.

It is easy to engineer a sub £1 balance - just make a single purchase of low value but then pay this amount less 99p ahead of the statement date.

Mikeyorks

calleyw wrote:

Madness, pure madness. But the funny thing was I was happy to pay 83p as well.

Agree it seems a little contrived. And some organisations also have an Admin limit where they will apply for a small outstanding amount - but not follow it up, if not paid. Which makes a bit more sense?

And that's partially because some people will pay their '83p equivalent' in stamps or a PO - which pushes up the receiving organisation costs even more. As stamps have to be handled via 'petty cash' and POs are a total pain to process automatically. They're too flimsy to run properly on the machines that process cheques. And a lot of Banks won't accept them into bulk cheque accounts anyway - for similar problems created in the Clearing cycle.

So a lot of places have to separate the POs out - aggregate them and exchange for a composite cheque with Royal Mail. Then process the composite cheque against all the accounts where a PO was received.

All of which gets a bit costly and all the manual intervention makes it a bit error prone. Makes you feel sorry for them?:rolleyes: