Refunding credit card overpayment

alexo

I find the outcome of this simple situation incredible...

I recently accidentally overpaid on a credit card - by £10 . The card in question was an IF visa. I hadn't used it for a while (zero balance). When I spent £15 on it - I then decided to pay this off straight away.

I thought that my direct debit was configured to take the minimum payment when in actual fact it was set up to pay off the balance (yes... I should have checked). Because I thought that £5 (the minimum) was going to be paid off I made an additional payment of £10. This resulted in me actually paying off £25 when my balance was only £15

Once I realised what I'd done I phoned IF to get my tenner back. I had accidentally done this with egg years ago and they just sent the money back - so I assumed that IF would do the same.

Oh no... they told me that if I had the £10 transferred back to my account it would be considered a cash withdrawal and I would be charged interest accordingly!!! The way I see it is that IF were going to charge me interest on money they didn't even lend me !!!! How can this be possible\legal?

I subsequently discovered that if I closed the account I would get my £10 back and not be charged interest. I had been planning to close the account anyway for other reasons but this really was the final straw. Account closed.

Am I being completely naive here? Surely what IF tried to do cannot be right ??

Robert_Sterling_3

You made a mistake.
You have got your money back.
You have closed an account you did not want.
I would just forget about it.

Rafter

Does seem a bit over the top on their part.

They have to be careful about money laundering rules but this seems a bit ridiculous.

Certainly my bank refunded to my current account with any hint of charges when I did the same thing once (first direct)

johnllew

Oh no... they told me that if I had the £10 transferred back to my account it would be considered a cash withdrawal and I would be charged interest accordingly!!!

The person you spoke to was almost certainly wrong. Ask to speak to a supervisor to have the money refunded without charge. I have been told the same thing on a couple of occasions and it was always wrong.

Sub_2

You should have simply spoken to your bank and told them the direct debit was taken in error, and you want it refunded to your account.

Tha bank *must* do this, and they can't charge you for it. Your credit card people couldn't really grumble either because you had already made a payment to the account to cover that months spending.

System

I might be one of few but I never have direct debits set up for credit cards - I always keep on top of bills, regularly access my accounts online to keep on top of things.

I've usually made my payment before the paper statement arrives, as card companies seem to have a habit of sending them second class - in some cases I've not received a statement until 10 days after the date on it. As interest is charged daily - that's money in their pocket.

Your situation is the reason why I don't use a DD. If you can be disciplined enough, they are best avoided. Paying manually gives you the freedom of paying what you want. DD doesn't give you that - it's either the minimum or the whole balance.

ashmit

DD doesn't give you that - it's either the minimum or the whole balance.

Egg will let you put a set amount, and as far as I know you can change it whenever you want - the date is set but the amount could be changed every month. They may be the only one though.