Nationwide credit card complaint - really need help!

7sefton

Hi everyone - hoping for some advice after a really disappointing and frustrating call with Nationwide complaints.

I have a credit card which had a 0% balance transfer offer (about £4k). 

A few months ago I made a purchase for £1.5K for a new car, to benefit from the consumer protection. I saw the transaction come up on my app (presumably as pending, but it was there), and the next day I paid it off in full with a debit card via their automated line. 

Or at least I thought I did.

I’ve just noticed I’ve been getting charged full interest on the £1.5K purchase. When I called to query it, they said they had allocated my debit card payment to the 0% balance transfer, as the purchase transaction was pending. In the words of the agent, ‘I was too organised and too quick’ to pay it off. So effectively they’ve reduced my 0% balance and are still charging me c.30% interest on the purchase. 

I made a complaint and the complaint handler said she agreed the information was unclear. However, she said she said was unable to reverse the transaction (even though she wanted to) due to system constraints, and said the best she could do was refund two months of interest charges ‘as a gesture of goodwill’. I would either have to find another £1.5K to clear the purchase balance myself (which I don’t have) or keep paying eye watering interest on it.  

At this point the call got very frustrating: I said I was going to suffer financial hardship and be trapped on high interest even though she admitted the information was confusing. She then said she wasn’t upholding my complaint as the statement small print states the order of payments, starting with the highest. I argued that they have done exactly the opposite, but she said it was due to the fact the purchase was pending when I made a payment. Something which is not even stated. 

I’m at my wits ends and really worried. She said there was nothing more she could do except escalate to the final response team, who can take 56 days ‘and probably won’t be able to help’. She also said she couldn’t even refund me the two months of interest as I wasn’t accepting her resolution. 

Do I have a leg to stand on here? As far as I’m concerned:

- I saw the purchase come up in my app
- I made a payment on the automated line with no warning about pending transactions 
- Nationwide admit the information is unclear but can’t reallocate the payment so I’m stuck with a serious financial blow and they can’t help

please help, thank you!

CliveOfIndia

Unfortunately, if the transaction was still in a "pending" status then any payment you made would not be allocated to it.  This is true of all credit cards, and is one reason why you have to be incredibly careful when spending on a BT card.

Given that the fault lies with you (I'm not meaning that nastily, it's just an objective statement of the facts), I think the goodwill gesture they've offered is very reasonable.

Probably the simplest option from here is - assuming you're not in a position to pay the full amount - see if you can shift the entire balance to another 0% card.

SuperAllyB

I don't bank with Nationwide so can't check but most cards I've seen say in the allocation of payment details that they go to statemented balances first, if so they haven't done anything wrong and the two months interest might have been better than nothing from them.

Going forward, assuming you don't get anything from Nationwide, would you be likely to get another balance transfer card elsewhere that you could transfer the £1500 to?

7sefton

Thanks both for your help, hard lesson I’m just annoyed that they didn’t (by their own admission) make clear that pending transactions that appear in my app don’t count until a statement has been generated. 

MorningcoffeeIV

As you've told them you're in financial hardship as a result, I would look to get other cards ASAP if you don't already have them, as you may find your limit reduced over time as you're gradually managed off the book.

Gerry1

As above, limit the damage by transferring the  balance to another card.  But still submit a formal complaint, ask for a deadlock letter and go to the ombudsman upon receipt or after eight weeks if they don't send one.

You could reasonably argue that, as it takes a few days for the debit to be applied to your account, you expected exactly the same delay to apply to your inpayment, hence the two transactions should have remained in the correct chronological sequence.

You may find they will settle because it'll probably be cheaper than paying the ombudsman's fee.  They also have a Holier Than Thou attitude so they'll be keen to avoid judgements going against them.

TheBanker

I think I saw a recent FIS decision where someone had done something similar and FOS upheld their complaint. But it was a different lender so doesn't automatically mean you'll win at FOS. 

Personally I would complain, but I would also try to limit my losses by transferring to another 0% card if you can get one. If you do transfer, ask Nationwide to cover any fees as part of their redress (as ultimately you are doing it to mitigate the loss).

I'll try to dig out the FOS decision when I get home. Feel free to PM me a reminder if I forget!

eskbanker

I had a look around for FOS decisions in this area and came across this one, in which they came down on the side of the card provider (Santander) after a similar distinction between statemented and unstatemented transactions was explained in their Ts & Cs too....

https://www.financial-ombudsman.org.uk/decision/DRN-2869521.pdf

Personally I wouldn't place too much reliance on a sympathetic agent 'agreeing' that wording wasn't clear, in the context of Nationwide's wording also making that same differentiation:

We allocate payments to balances which show on your current statement in a high to low interest rate order, then, to balances in a high to low interest rate order which do not yet appear on your statement.

but FOS can be a bit of a lottery sometimes!

Altior

The transaction has to show on the account immediately, otherwise the available credit balance could be spent multiple times over. A transaction that hasn't been cleared can't be paid off. The algorithm will simply allocate an incoming payment to what can be paid off, if no outstanding balance it will become a credit balance (against t&c ordinarily). I hope that you didn't give the support agent a hard time. This is one to put down to experience, and mitigate as best you can as above.

TheBanker

eskbanker said:

I had a look around for FOS decisions in this area and came across this one, in which they came down on the side of the card provider (Santander) after a similar distinction between statemented and unstatemented transactions was explained in their Ts & Cs too....

https://www.financial-ombudsman.org.uk/decision/DRN-2869521.pdf

Personally I wouldn't place too much reliance on a sympathetic agent 'agreeing' that wording wasn't clear, in the context of Nationwide's wording also making that same differentiation:

We allocate payments to balances which show on your current statement in a high to low interest rate order, then, to balances in a high to low interest rate order which do not yet appear on your statement.

but FOS can be a bit of a lottery sometimes!

To prove your point about FOS being a lottery, the complaint they upheld, that I was thinking of, was also Santander: https://www.financial-ombudsman.org.uk/decision/DRN-4024727.pdf

Although in that case Santander don't appear to have helped themselves or their customer because it looks like they didn't really explain how the payments are allocated when he asked.

Anyway I think this proves that the best course of action is, if possible, mitigate the loss by paying off the balance or transferring it to another 0% card. In parallel make a complaint to Nationwide. At least that way if they don't uphold it, you've minimised your loss. 

born_again

You are not the 1st & will not be the last to get caught out with this.

You have to wait till you receive the statement for the period that payment is in. £1.5K in this case.
Any payment prior to the statement goes towards the last statement, in this case your balance transfer.

In reality, I wish people would ask the bank before making a assumption on situations like this. Would save a lot of complaints & grief & heartache for customers.

2 months interest refund is a good outcome.