Credit Card Providers to be Fairer in 2011
67Changes to the Lending Code
Changes to the Lending Code (followed by financial institutions on a voluntary basis) which came into force at the beginning of 2011 should ensure that credit card customers are treated more fairly in the future. For the 30 million credit card holders in UK, this could make a massive difference to their finances, especially the 39% that do not pay of the full balance on their card each month.
· The most expensive debt on the card will be paid off first (alleviating interest build up on this debt if other smaller debts are paid off first)
· Minimum repayments will be changed so that consumers must pay back all interest and charges, and 1% of the balance
· Unsolicited credit card cheques will be banned
· Providers will give 30 days notice of credit limit increases, giving time for the customer to turn them down
· Additional flexibility allowing customers to choose how much they wish to pay off the card each month (rather than just the minimum or all of the balance)
The changes are great news for credit card customers who can be safer in the knowledge that they are being treated fairly. However, they also highlight that fact that consumers were not being treated correctly in the past, and may have incurred charges on their account for going overdrawn or not paying off debts within set time periods that could have been avoided.
In addition to this the Office of Fair Trading (OFT) also investigated the level of charge financial institutions were applying to customers. In 2006, OFT decided that these were too high, and most companies have now reduced them to £12.
The good news is that it is possible to claim back these charges, whether they were unfair or just too high.
The Claims Guys is a claims management company specialising in helping consumers claim back mis-sold PPI and credit card charges. To find out more about how we could help you, visit www.theclaimsguys.co.uk or give us a call on 08000 8 222 00 for a no obligation chat.
