Nationwide Credit Card - Gambling considered as Cash Advance!!!

mich_roh

I just received a change of T & C for my Nationwide Credit Card.

Here is something which surprises me :


“cash advance”

means obtaining cash, foreign currency or

travellers’ cheques,

or gambling, using the card.

The maximum amount of cash advances is 50% of your credit limit.

“gambling” means a transaction that we recognise as having
been made at an establishment where gambling is carried out,
which includes internet gambling, whether or not the purpose
of that transaction is for gambling purposes.

Here is the link to the changes:

http://www.nationwide.co.uk/pdf/creditcard/P9502_AUG_07_6.pdf

This does not affect me but
Why are they charging fees for gambling ??? Say I walk into a casino and order drinks for everyone and pay through my credit card, I have no credit free period but it is considered a cash advance!! even though I have not gambled!!

Rafter

mich,

Fact is that you can use a credit card for online gambling sites at a casino.

Fact is that people who gamble using credit cards are taking a high risk and are far less likely to be able to repay their debts.

Therefore most credit cards now charge a higher interest rate and cash advance fees to a) Try and discourage customers from gambling on credit cards and b) recover some of their bad debt costs.

Seems reasonable to me. Personally I'd rather they banned use of the card for gambling which some other cards have done, but difficult to enforce with so many online gambling sites.

R.

Gorgeous_George

If only credit card had such noble reasons.

My guess is that you could gamble £1,000 on RED and £1,000 on black. Assuming the roulette wheel doesn't land on green, you effectively have a £2,000 cash advance. Maybe placing a bet and then laying the same bet would provide a better example (though, of course, you are likely to lose a little in doing so).



GG

mich_roh

All the current credit card savy generation who will age and start playing BINGO are stuffed

My point is that even though i dont gamble but pay for food etc... I am still get charged as a cash advance . .

It would be interesting to see how many bad debts are due to Gambling... I bet majority of the people just overspend on other stuff and get into trouble.

mich_roh

Personally I like Nationwide Credit Cards a lot as they pay off the higher interest rate loans first and dont charge for overseas transactions etc. This is the reason why this issue annoys me a little bit.

I have just gone through some of the banks annual reports. Generally impairment costs are around ZERO (very very small to be noted as a number dosent mean nil) to 2% of the total lendings of the bank.

Specifically lets take Nationwide
Only 3.6 % of the total lendings classified under LOANS AND ADVANCES TO CUSTOMERS are unsecured (commercial loans, overdrafts, personal loans, credit cards etc.)

Hence credit card loans are for eg. 1/4 of the 3.6%. The impairment costs are around 1% of 1/4 of 3.6% and impariment costs due to gambling related activities will be a fraction of this.

My point is impairment costs due to gambling are a minute fraction of their total lendings. Hence why introduce such caveats when any potential benefits are going to be minimal.

OR else there is some other reason??

Biggles

Every other credit card I know has done this for years, it's just something else Nationwide has been very good on till now.

I've had to reluctantly switch all my account from Nationwide CC to my bank debit card.

Paul_Herring

It's a credit card, and you're withdrawing money (as opposed to paying for something) to gamble with - it's just a cash withdrawal via another method (the usual one being sticking it in an ATM) - something they regularly charge for.

This has nothing to do with the fact it's gambling.

jamalfatty

And you probably wouldnt get charged for a cash advance if you used it for drinks as per your example, I would imagine any reputable casino would have a different MCC (merchant category code) for anything non-gambling related thus your credit card company would be able to differentiate between the two