Sharp Practice by MBNA

Mike_Draper

I thought forum members should be aware of some sharp pratices by credit card company MBNA.

I pay off my card in full each month, which is obviously not popular with the card company.
However, I was 1 day late paying in February and hence incurred interest on my March statement. I was surprised to find interest also added to my April statement, even though March was paid off on time and in full.
Upon querying the interest charged I was informed that as I was a day late in February, I had therefore breached the terms and conditions of my card and interest was now charged on a daily basis from the date of any transaction; effectively all 'credit' on the card had been terminated without any notification! They said they would review the situation 'in a few months' and consider returning the credit facility!! Beware, and don't use MBNA.

jamalfatty

All credit cards work like this, its called 'residual interest'

clio

So are you saying you have lost your 0% offer you had !!
if so this is a fav stroke by the CC companys as they say it,s your fault for breaking the t & c's

Lavendyr

Actually, I understood it as being that while normally credit cards offer "up to 56 days interest free on purchases" as long as the balance is paid off in full and on time each month, the OP has now lost this.

NickX

Lavendyr wrote: »

Actually, I understood it as being that while normally credit cards offer "up to 56 days interest free on purchases" as long as the balance is paid off in full and on time each month, the OP has now lost this.

No, they havent lost this feature of the card, but because they failed to pay the balance off in full and in time, the feature wasn't applied, therefore they were charged interest.

If they were on a promotional rate, then I suspect that will have reverted to the standard variable rate.

Valerie_Barter

I've got 2 credit cards with this company and have sent the first letter to try to get back the monies paid. They've said, today, that over the period of time I've had the cards, they've sent me up to date literature regarding the insurance and, therefore, they're not obliged to pay back anything. They did, however, say that they may be able to decrease the amounts to be paid back.

Before I take any further action, I'd like to know if anyone has any idea of the 'ins and outs' of their offer.

johnllew

It's not sharp practice; this is normal with all credit cards. In future, avoid this problem by paying the full balance by direct debit.

DipStick

I had the same experience with MBNA. They charged me £12 because I'd paid 2 days late, plus interest. I rang and asked if they would waive the £12. The guy said he could only waive £6 of it. I said I'd been thinking of cancelling the card. He called my bluff and said 'would you like to cancel it now?' I said 'tell you what, you waive the whole £12 and I won't cancel the card'. He said 'I shouldn't really but OK, the £12 is waived - I see you do normally pay off in full each month'. I didn't push my luck and argue about the interest.

But next month I was charged residual interest, didn't know why, so rang to ask. The guy explained and I asked if he would waive it and he did.

So it pays, politely, to have a go.

DipStick

When you call your CC company always ring on an 0800 number! When you get your card you get an 0800 to call to confirm receipt - call them on that number. Or, look on their website for the freephone number for new customers and ring on that one - if you're polite and play dumb they will usually deal with your question or put you through to the people who will.

Lavendyr

NickX wrote: »

No, they havent lost this feature of the card, but because they failed to pay the balance off in full and in time, the feature wasn't applied, therefore they were charged interest.

I'm not sure it's as simple as that though, reading the OP carefully, though it would be most helpful if OP could come back and clarify!

Mike_Draper wrote: »

I was 1 day late paying in February and hence incurred interest on my March statement. I was surprised to find interest also added to my April statement, even though March was paid off on time and in full.

So they made a late payment in Feb, and incurred interest accordingly. But even though they paid on time and in full in March, interest still continued to be added on further statements.

So I read it that the feature not only wasn't applied when the payment was late, but is now no longer going to be applied until MBNA decide to reallow it.

YorkshireBoy

Don't you have to pay two successive statements in full* to stop the interest being applied?...and April's will be the second one.

There will be no interest showing on the May statement if the April statement is paid in full by the due date.


* The alternative being to overpay the first one slightly to create a small positive balance >= the value of estimated interest to be applied on the next statement.