MSE News: Co-op admits to unfair rate-jacking rule

Consumerist

KimYeovil wrote: »

I really can not understand the motivation of the advocates of this.

That much is crystal clear.

th081

when i first saw this story i thought the COOP were being harsh, and still do. But i think British society would be much better if all credit cards going forward had a minimum 10% of the o/s balance to be paid off each month. ie you had to pay it all off in 10months, it would stop people getting into debt

Milarky

th081 wrote: »

when i first saw this story i thought the COOP were being harsh, and still do. But i think British society would be much better if all credit cards going forward had a minimum 10% of the o/s balance to be paid off each month. ie you had to pay it all off in 10months, it would stop people getting into debt

Not possible at the present time - you would have to get there over a number of years IME by raising the standard minimum payments quite gradually (to 2.5%, say then 3%, then 3.5% and so on) Minimum payments are an issue for too many people. The Coop were just being unrealistic (actually, they knew exactly what they were up to!) in expecting customers with £1000s in debt (and often paying just the minimum payments) to clear these in a matter of months. If they'd set 2 years (about [STRIKE]3.5%[/STRIKE] 4.5% per month in practice) as the time-scale instead I think they'd have been accepted as 'ethical' [just!]

As it is "where any customer is in hardship, any time-frame was and always will be considered on an individual basis, with particular regard to each customer's financial circumstances" doesn't actually mention the interest not changing, now, does it? So they are actually being unrepentant in my estimation.

Consumerist

Milarky wrote: »

As it is "where any customer is in hardship, any time-frame was and always will be considered on an individual basis, with particular regard to each customer's financial circumstances" doesn't actually mention the interest not changing, now, does it? So they are actually being unrepentant in my estimation.

I think, as I understand it, the interest rate must remain the same under the terms of the agreement with government. It's only the interpretation of a "reasonable time" which is in question here.

Paulgonnabedebtfree

th081 wrote: »

when i first saw this story i thought the COOP were being harsh, and still do. But i think British society would be much better if all credit cards going forward had a minimum 10% of the o/s balance to be paid off each month. ie you had to pay it all off in 10months, it would stop people getting into debt

I suppose that this could be possible if it were only applied to new debt. It could still cause problems though if someone needed to replace an essential item and hadn't managed to save. It would probably mean a return (for some) to HP or its equivalent and to the old mail order catalogue ordering systems.
I seem to recall that 5% minimum per month was pretty normal anyway for many credit cards if you go back perhaps 20 years.

Leonard_Graham

plumber2009 wrote: »

I thought these people had an ethical banking policy?

Obviously not.

There are some serious questions concerning the ethical position taken by Co-op Bank and Co-op Insurance. The Financial Times recently showed that 2 of the 10 highest charging pensions were from Co-op Insurance, one took 35% of the pension fund in charges - extortionate. These are supposed to be ethical organisations, so what has gone wrong with them?

Paulgonnabedebtfree

Today I have received a "notice of variation" (of T & Cs) from Co-op bank. The six month clause is still stubbornly contained within it.

[Deleted User]

Paulgonnabedebtfree wrote: »

Today I have received a "notice of variation" (of T & Cs) from Co-op bank. The six month clause is still stubbornly contained within it.

Interesting. Thanks for letting us know.

What have they changed in the NoV? Any amendment to the 6 month clause at all?

Paulgonnabedebtfree

Deleted_User wrote: »

Interesting. Thanks for letting us know.

What have they changed in the NoV? Any amendment to the 6 month clause at all?

No change in that.
I did write as much in my post.
You have just taken skim reading to a new level .

Nice username BTW.
Did you ever have a ZX81?
My own career started with a Commy 64 and my mate with the VIC 20 was really jealous

[Deleted User]

I did read the post - honest. Just wondered that althought the clause is still there, if they'd made any reference to it at all -ie "Maybe we won't apply the clause if you really shout at us, because we don't want too much bad publicity." Anyway - what was in the NoV then?

I did indeed have a ZX81, then moved onto a BBC. Even though us BBC owners knew we undoubtedly had the superior machines (heck - the letters BBC told you that), we secretly knew that the Vic20 and Commodore owners had the better games. Even though Commodore owners had non-functioning Z and X keys after they'd played Track and Field for a month.