Misleading Nationwide Credit Card Rate Increase

waynebaal

It appears that Nationwide staff do not understand the difference between percentage points and percentage.  I received a letter informing me of an increase in the interest rate from 19.9% to 24.9%.  This, it stated conclusively, is an increase of 5%.  WOW!!  Some people will read this and accept that 'headline' figure and may not be overly concerned.  They may not immediately realise that they will actually be paying 25% more in interest than they were previously paying.  This could hit the less-well-off pretty hard, and come as a bit of a shock as they had a mere 5% floating around in their mind!

These institutions should be forced by law to give accurate figures that represent the actual increase, and not be allowed to hide behind this often misunderstood and deliberately misleading representation of percentage increases.

TheMilkmansDad

well to be fair - it is an increase of 5%. it has increased by 25%

molerat

It appears that Nationwide staff do not understand the difference between percentage points and percentage.

And neither do Joe public.

waynebaal

TheMilkmansDad said:

well to be fair - it is an increase of 5%. it has increased by 25%

No, it is an increase of 5 percentage points.  It doesn't matter whether or not you say 'of' or 'by', it is still a 25% increase .

Ayr_Rage

@waynebaal there is nothing misleading to anyone of average intelligence.

waynebaal

molerat said:

It appears that Nationwide staff do not understand the difference between percentage points and percentage.

And neither do Joe public.

Yeah, that's the point I was making.  Vulnerable people will read this and think that 5% more isn't too bad, then WALLOP!! .

waynebaal

Ayr_Rage said:

@waynebaal there is nothing misleading to anyone of average intelligence.

So only people of below average intelligence can be misled?

Sarahspangles

I threw the leaflet away, as I pay in full, but if the information in the leaflet is the same as on the website then it’s explained in plain English and with worked examples.

https://www.nationwide.co.uk/credit-cards/help/credit-card-interest-rate-increase-faqs

‘Going up by 5%’ is explained as ‘42 pence more each month, for every £100 outstanding on your balance’.

molerat

I am sure though that the majority would read it as the interest rate, and what that means, is increasing by 5% rather than the interest charged is increasing by 5%. They don't really need to understand the finer points of terminology.

MattMattMattUK

waynebaal said:

Ayr_Rage said:

@waynebaal there is nothing misleading to anyone of average intelligence.

So only people of below average intelligence can be misled?

This is not a case of people being mislead, but of someone deliberately trying to misunderstand.

Jami74

I shouldn't think it'll make much difference to 'the less well off'. If they can't afford to pay a credit card charging 19.9% interest then calling the increase 25% rather than 5% won't make them afford it any easier.