MBNA stops cash withdrawls ?

nibbles051

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chattychappy

Strange... Of course cash withdrawals can be a sign of a borrower in distress, but on the hand they are rather lucrative for CC companies. Except for Zero which I use for cash overseas, I've only used them:

1) by mistake - simply putting the wrong card in an ATM
2) when I forgot the PIN of my debit card
3) when I left my debit card at home

I'm sure that goes for a number of other cardholders too. Never had them blocked, though not used MBNA in an ATM for a couple of years. In the end, if people are going to max out their cards, I would have thought it better from the CC company's point of view if they do it via cash advances!

nibbles051

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PNPSUKNET

if you are a high risk they wont allow this facility, did you used to also use it often?

TFD_2

chattychappy wrote: »

In the end, if people are going to max out their cards, I would have thought it better from the CC company's point of view if they do it via cash advances!

I guess their risk analysis says otherwise - Barclaycard for example set a cash limit that is often a fraction of the overall credit limit.

Maybe people that utilise this facility regularly are more likely to default - that would make sense.

Any

TFD wrote: »

I guess their risk analysis says otherwise - Barclaycard for example set a cash limit that is often a fraction of the overall credit limit.

Maybe people that utilise this facility regularly are more likely to default - that would make sense.

Completely agree.

If you are that desperate as to need to withdraw cash from your credit card then the chances that you are going to be able to repay bills in future are slim.

I am sure that lots of people will start shouting that this was one time and genuine reason blah blah blah, but the % of people having genuine reason for withdrawing cash over paying for food or item (example) by credit card is so little that of course it makes more sense for credit card companies to make sweeping judgement.

If you can't manage your finances as to what to pay for by cash and what to pay for by credit card in order to make sure you will not have the need to withdraw cash on credit card, then you are high risk.

Credit cards were not designed for ATM withdrawals. Full stop.

Only some offer it as special incentive to choose them (ie Santander for foreign currency).

fozmcfc

I've a Virgin card, but cannot find anywhere on the T&C's any restrictions regarding the amount you can make in cash withdrawals, possibly it is per individual.

In my bad credit card using days, I used to withdraw cash regularly.

Natwest used to stop me most of the time (I guess I was up to their limit allowed for cash withdrawals), Egg on the other hand, would let me take £400 after £400 out and never once stopped me.

The last couple of cards I have had, have said something along the lines of you may use 30% of your available limit for cash withdrawals.

Just checked online and my account says "Available for Cash or Purchases" then shows the amount, which is basically upto my limit.

[Deleted User]

Any is right. Which is also the reason gambling is treated as cash advances, as it's indicative of greater risk.

In extreme cases, you see cash withdrawn on a card to the amount of the min payment due in a couple of days. Min payment is then made in cash, balance rises, cash withdrawn 30 days later, min payment made, balance rises....

Hands up if anyone can spot the flaw in this strategy.

redpete

nibbles051 wrote: »

...and got told that ATM withdrawls are disallowed, but I'll have to write in to question why (I'm not going to)...

Why not?

Is this an across the board clampdown or just a select few ?

No need to guess from other people's replies if you write in and ask them.

oscar52

There isnt much point in writing in to be honest.

The response you will get will be along the lines of "our T&Cs state we can withdraw your credit facility at any time" or that "... we can reject certain transactions.."

It could be related to risk, it could be realted to the profitability of your account. It could be just a random reason. However any response you get will be vague.

chattychappy

I suspect some of the "clampdown" is to do with fraud - cloned cards being used to get cash at ATMs, particularly abroad. As for gambling, I believe the switch was due to regulatory burdens and fraud risk.

The only time I had cash advances restricted was on a 10K Barclaycard where I had a limit of 5K. Within a few months that restriction disappeared.

Agree with the gist of what people have said (not with the patronising presumptions). But what has happened here seems like an overreaction by the bank to risk instead of pricing it in to the product. And of course banks getting into a panic is nothing new.