Refunds don’t count towards payments

thebandit64

Hidden in the small print, a refund to your credit card doesn't count as a payment, they still want your monthly payment. I had a refund of £700, which I (stupidly??) thought would count as a payment as it reduced my balance by same amount. I therefore missed my £10 minimum payment assuming they’d already had £700 that month, and the card provider have marked by credit file as a missed payment. Even worse, I thought the random phone call they made to me was spam and I actually reported it to them!  So heads up people, don’t get caught out as it’s hidden in the small print, which most of us wouldn’t even have noticed!

TadleyBaggie

Give us a clue, what credit card provider? Some do take account of refunds, some don't.

thebandit64

TadleyBaggie said:

Give us a clue, what credit card provider? Some do take account of refunds, some don't.

Card provider is TSB

surreysaver

Some do, some don't.  And it's not always obvious.

eskbanker

thebandit64 said:

Hidden in the small print, a refund to your credit card doesn't count as a payment, they still want your monthly payment. I had a refund of £700, which I (stupidly??) thought would count as a payment as it reduced my balance by same amount. I therefore missed my £10 minimum payment assuming they’d already had £700 that month, and the card provider have marked by credit file as a missed payment. Even worse, I thought the random phone call they made to me was spam and I actually reported it to them!  So heads up people, don’t get caught out as it’s hidden in the small print, which most of us wouldn’t even have noticed!

As you accept, it is in the Ts & Cs, but there's always going to be a limit of how much can reasonably be specified in the summary product data at a higher level:

16.4 If you buy something then take it back and get your money back, that refund won’t count towards your minimum monthly payment (unless the refund pays off all amounts due on the card, whether shown on your statement or still to be applied). You still need to make the minimum monthly payment separately.

https://www.tsb.co.uk/credit-cards/general-credit-card-conditions.pdf

daveyjp

John Lewis (HSBC card) - as TSB.  refund was accounted for at the next statement date.  Any Credit balances could be refunded on request.

Barclaycard.  Any refund received before payment due date is used as a part payment against the balance and direct debit will be adjusted.

etienneg

With credit cards you should always have a direct debit set up to pay at least the minimum balance. That way you never fall foul of failing to pay the minimum balance, whatever the CC company says this is.

zagfles

It doesn't make sense for a refund to be treated as a payment, but some cards do eg Barclaycard as above. A refund is negative spending, so should count like spending (negative obviously).

I don't like the way BC do it, because what usually happens is the refund is in the same statement period as the spend and so the refund goes towards paying off the previous statement balance, and the next statement has the spend but not the refund. Technically it works in the customer's favour as you're paying less earlier and more later, but it's confusing when the DD isn't the expected amount. 

It also causes confusion when you have a 0% balance transfer and try to maximise its value by spending the min payment so you're not paying it down, and then get a refund...

born_again

thebandit64 said:

Hidden in the small print, a refund to your credit card doesn't count as a payment, they still want your monthly payment. I had a refund of £700, which I (stupidly??) thought would count as a payment as it reduced my balance by same amount. I therefore missed my £10 minimum payment assuming they’d already had £700 that month, and the card provider have marked by credit file as a missed payment. Even worse, I thought the random phone call they made to me was spam and I actually reported it to them!  So heads up people, don’t get caught out as it’s hidden in the small print, which most of us wouldn’t even have noticed!

There is also the issue of when exactly the refund is processed.
Before statement, then it will balance out the debit. After statement is produced, as other have said does depend on provider.
Which is shy advice is always to have a min DD set up.

grumpy_codger

zagfles said:

It doesn't make sense for a refund to be treated as a payment, but some cards do eg Barclaycard as above. A refund is negative spending, so should count like spending (negative obviously).

It does make some sense. E.g. if you pay £10K before the statement day and get it refunded soon after.

DullGreyGuy

But then you would never need to make a payment on your card as if the minimum payment was £150 then just buy something for £150 and take it back the next day.