LLoyds TSB increasing interest rates on credit cards with no good reason

CH27

pcrich wrote: »

LLoyds TBS have just sent a letter informing me that they are increasing the interest rates on my two platinum credit cards with out any good reason other than, they state "it is in their terms and conditions that they can". I was under the impression to have a "platinum card" required some kind of excellent credit rating and therefore despite no change in my circumstances they can up the rate without good reason. I have a limit approaching £23,000 so that would back that thought up.

I have never gone anywhere near my credit limit, I have never missed a payment (on any card) or any other payment actually. I have never drawn out cash on the card , or paid for gambling transactions, I have never paid only the minimum payments for the cards, I have never gone overdrawn in over 30 years of having a current account or done anything else that could in the widest terms be classed as risky behaviour.

I usually run up a small balance for items usually holiday spending etc and then pay it off over a few months when I return. This has been done for the last three years, but for some reason they have now jacked up the interest rate this year, or rather tried to I have cancelled both cards after 10 years of loyal custom with the bank.

I have made an official complaint as I am interested to see if the ombudsman would consider this to be a "fair" way to treat customers, I would ask that anyone else receiving this type of letter does the same
If enough of us complain about unfair treatment then maybe their actions will be called into question.
I have told them their letter is an attack on my good character as it indicates I have doen something wrong despite not ever doing so.
I suspect it is yet another attempt to increase profits and nothing more.:(:(:(:mad::(:(:(

:rotfl:
Well that will do the rounds of the bank to give everyone a good laugh.

_Andy_

pcrich wrote: »

I have made an official complaint as I am interested to see if the ombudsman would consider this to be a "fair" way to treat customers, I would ask that anyone else receiving this type of letter does the same

If you haven't exhausted the complaints channel with the company the FSO won't even look at it.

Suggesting that people complain about price increases is rather immature and would just result in the already over-worked FSO being swamped with whinging letters wasting more of their time.

Thrugelmir

pcrich wrote: »

I usually run up a small balance for items usually holiday spending etc and then pay it off over a few months when I return. This has been done for the last three years,

Then you aren't a particularly profitable customer for the bank. The overheads of administering your account wipe out any interest earnt.

Unfortunately many people borrow large sums of money then default. This is why credit card interest rates are so high. As its easy to obtain unsecured lending.

As with anything in life. Vote with your feet if you don't like your supplier for any reason. The bank owes you nothing nor you to to them. As the relationship is a business one nothing else.

Thrugelmir

For the record.

UK banks and building societies wrote off £9.5bn of loans to individuals in the 4 quarters to end Q1 2011. In Q1 2011 they wrote off £1.89bn (£866m of that was credit card debt). This amounts to a write-off of £20.71m a day.

Full article can be found below

http://www.creditaction.org.uk/helpful-resources/debt-statistics.html

pcrich

Thrugelmir wrote: »

Then you aren't a particularly profitable customer for the bank. The overheads of administering your account wipe out any interest earnt.

Unfortunately many people borrow large sums of money then default. This is why credit card interest rates are so high. As its easy to obtain unsecured lending.

As with anything in life. Vote with your feet if you don't like your supplier for any reason. The bank owes you nothing nor you to to them. As the relationship is a business one nothing else.

The only problem with changing cards is finance isnt quite like going to asda instead of morrisions.

You tend to build up a long relationship over the years and that is my point about them being fair. If I applied for more cards and went for the cheapest available when it was available I would soon find my requests rejected due to the numerous requests being made.

I am all for them making money and I felt 30 times the current base rate was more than ample. I am also fully aware about them being able to change rates on variable cards however the whole point about this post is about being fair to the customer which in my opinion their actions are not in any way fair

Thrugelmir

pcrich wrote: »

I am all for them making money and I felt 30 times the current base rate was more than ample.

Over simplification of what's involved in running a banking business.

Dominoes sell large pizza's at £14.99p. The ingredients don't even cost them 50p. The premium is for the product.

pcrich

Thrugelmir wrote: »

Over simplification of what's involved in running a banking business.

Dominoes sell large pizza's at £14.99p. The ingredients don't even cost them 50p. The premium is for the product.

And the fuel to cook it, and light the premises, the packaging for the product, the cleaning products for the premises, the business advertising costs, the staff wages and other staff costs, the premises rent, the business rates, the staff and product liability insurance.
Not quite as simple as you make out.

Further to my first post Lloyds have now sent a letter stating my other credit card account held with them is to have a lower interest rate than the first letter mentioned.

This all goes to prove to me that they dont know what they are doing all the time and sometimes it is best to challenge their decisions to ensure they are correct, and more to the point FAIR!

Imani

Lloyds have done this to me too yet I have never missed a payment. My credit file had 2 defaults when they issued this card to me well over 5 yrs ago. Not impressed. I am so tempted to request ppi charges refunding but unsure whether worth it. I probably should just find out what the ppi charges were first and then if it is worth the balance then pursue. I only came to know about ppi when i got a job in a bank prior to that I had know clue.

But the rate increases make no sense to a good paying customer. These days there are no distinction between a store card and a credit card. The rates are the same.

I have paid a large chunk of my balance and will clear this card soon.

chattychappy

Imani wrote: »

I only came to know about ppi when i got a job in a bank prior to that I had know clue.

Imani wrote: »

But the rate increases make no sense to a good paying customer..

I think you still have know clue.

And now you work in a bank?

jay87

The FOS will see what they have done as fair. Treating Customers Fairly is not about being nice, it's about being fair. Ie treating customers equally and based on set criteras for lending, which they have. You have been informed of any changes with prior notice which they are obliged to do.