OFT mulls Egg probe The Office of Fair Trading is considering investigating online bank Egg over allegations that it is ditching credit card customers who pay off their bills every month and so avoid paying penalty charges. Egg denies the claim saying that the 161,000 people told their cards were being withdrawn were considered a credit risk. The …
I have been trying to get these clowns to cancel my card for over a year. They agreed not to send any more cards in the post but wanted to keep the account open.
Maybe that was so that they could give false figures to any potential buyers..?
I always paid the balance in full and haven't used it for 3-4 years, maybe it will finally get cancelled because I am now such a poor 'risk'
Following Egg's decision, it was reported this weekend that Barclaycard are following suit, and ditching a bunch of customers on a similar basis - but a couple more customers. About a million of them, to be precise - about 10% of their customer base. And are reducing the credit limits of lots more, apparently - which should be interesting, seeing as those who are the highest credit risks tend to carry balances within spitting distance of their target, sorry, limit.
http://www.express.co.uk/posts/view/34469/Barclaycard-dumps-one-million
Main difference is that BCard aren't claiming that these people being dumped have slumped in credit rating, but that they are "dormant" - whatever that means. I'm pretty sure that people who have their card available for holidays and emergencies, but don't carry a balance, are going to be included...
At least it looks like I won't have to worry about getting more letters saying "Good news!!! We've trebled your credit limit!!!! Please spend lots of money on tat and get in hideous amounts of debt to us!!!" any more...
I have a terrible record with Egg - I've missed 4 payments over the last 12 months. They've called me before and said I'm totally out of control credit wise. A few months ago I paid off my balance. I have £5350 available and I live in a rented flat. So, massive risk to Egg I am, frankly.
And? They've not canceled my card. It's still there, over £5k available to me.
After being told by Egg that they were closing my account because my credit rating had suffered since opening my account, despite paying off my card every month and using the card in the previous month to purchase a plasma TV costing £800.
I telephoned asking for an explanation but was stuck talking to R2D2 on the other end for nearly an hour (I have a speach impediment and cannot for the life of my use those stupid voice recognition systems). In the end I got through to someone, who did not want to talk to me and said simply that my credit rating is bad and I could not use my card any more, In 35 days I would be unable to use my card AND their online account manager and that my card would be paid by minimum payments until the balance cleared.
They would not allow me to pay more than the minimum payment! which is rediculous when I clear my card most months, I was told that such a small balance will take OVER 3 YEARS to pay on their minimum payment system so I decided to apply for another card.
I sent an application to Mint, who told me that my credit rating was so bad they were giving me a card with 3x the limit of my Egg card, 1/2 the interest rate and 18 months interest free balance transfers, 9 months interest free purchases.
Needless to say I instantly transferred the balance for the new TV (as the transfer fee was less than 1 months interest at Egg) and promptly telephoned Egg and told them where they could shove their card and closed my savings account with them.
After having to listen to all that whining by people who "never go overdrawn" and who always "pay off the balance each month" whenever the subject of unfair bank charges comes up, I have to say that I find this hilarious.
I think they're are finally starting to realise that the people they've been looking down on all this time have been the very people who've been subsidising their "free" bank accounts.
Money is debt. It may be a harsh wake up call for some, but if we all paid of our debts, there would be no more money.
I received at the weekend an unsolicited mailshot inviting me to open an Egg credit card. Both the envelope and the paperwork inside bore the advertising slogan "You know where you are with Egg".
I have forwarded it to the Advertising Standards Authority with a comment that their slogan is both false and misleading.
I left Egg when they decided it was ok to lie to me about payments made into a savings account. They swore blind via the Egg email system they could not tell me who paid the money in due to 'data protection' and 'privacy' reasons. I called their bluff but they were insistent. I ended up phoning them and asking for the info, which was given to me within minutes.
I closed down my accounts soon after that as It's never wise to give your money to someone you can't trust.
Let's see. Not only am I a Credit Risk to Egg (£3700 balance - £0 outstanding), but I've also got a loan from them which will be finished this year.
So they've taken my Egg Card off me. Never used it, don't care. However, I'm wondering if I'll soon be told that my Fixed Rate Loan will soon stop me accessing it and that I'll only be able to make the minimum payment (ahem) and that I'll be unable to use their Money Manager, that I did use to access all my accounts.
Which I won't be using anymore, since I don't want someone who doesn't trust me being able to access all my accounts.
Paris, because even that plank of wood has more brain cells than Egg's idiot finance team.
I'm somewhat surprised at the OFT, you think they would have better things to do.
When was it that having a credit card from a particular organisation became some sort of god given right?
I urge many of my clients to review their portfolio each year and look to remove 10% of their customers. The customers who you don't profit from, who don't bring in any referral business etc. Replace them with the customers you would actually prefer.
Admittedly egg wont win any prizes for the way way in which they went about this however pioneers often come in for flack and abuse. Watch now as Egg get flack and other card firms follow suit over the next 12-18 months.
Mike Ashworth
Business Coaching and Consultancy
Brighton and Hove, Sussex, UK
Recently they keep trying to take the full balance off us when we've set the payment option to a fixed amount. First time cleared us out for the month and resulted in failed payments in our curernt account because the egg payment took us right up to our agreed overdraft limit. Further normal payments were then bounced, all resulting in fees and charges.
Egg's attitude on the phone was "tough, that's how it works", and refused to listen to our demands for compensation. Sorry, but that's NOT how it works. We've been with them for years, and it always used to debit what we set it to, and the setting stayed put until we changed it.
The following month, we kept a closer eye on it. Several times we changed it from "pay full balance" to "pay £100", but each time, it got reset a few days later. We phoned them, and they set it for us, and again a few days later it was reset.
In the end, we phoned them up again and paid an agreed amount as a one-off payment, and then cancelled the DD on our account. Despite them agreeing to it, they still sent us a nasty letter when the DD they said they wouldn't take was bounced by our bank, and a form inviting us to set up a new DD - we put it in the recycling.
Used to be good, now a load of pants, and good riddance to them.
Paris, because she doesn't know a lot about pants.
We've stopped using our Egg card as they have applied several small interest charges to our account that we paid in full (using their automatic system) every month. Two cash advances did generate some genuine interest, but even that was calculated oddly: interest on two weeks was more than the interest on the whole previous month...
The charges still haven't been explained, even after more secure message exhanges than you can shake a stick at. Each message explained where to find charging information, and completely failed to answer the question of what on earth had triggered the charge in the first place :(
In the end they did refund some of the unexplained interest charges, but not all of them. And I don't trust their calculations at all any more.
mike ashworth - the point isn't about any 'right' to a credit card, it is that egg is clearly either lying or incompetent, neither is desirable in a financial institution
steve - what is 'hilarious' is your ignorance of how the credit card industry operates - operators charge the retailer a fee on every transaction, operators also hang on to the money for a while before giving it to a retailer, and if you spend outside your home country they'll also gouge a bit more on loaded forex rates. if there were no interest charges and no extended credit they'd still be operating profitably
...about 12 months ago, after they gave me *6 hours* notice of a change of interest rate (via email) - in direct breach of their own T&Cs.
My wife also has an Egg card, and she wasn't notified until about two days *after* they'd increased the interest rate on her account.
Their explanation was that their T&Cs say they only need to give you advance notice if it is to the detriment of the customer - otherwise something like 21 days notice would be given by post.
Since when was foisting a higher rate of interest on a customer *not* to the customers' detriment ?
They refused to answer.
FWIW I had a £12k limit on my card, and regularly sat £6-8k on there for a few months (paying interest). They used to be competitive (~12% at one point IIRC) but now they're one of the more expensive pieces of debt cards.
About 18 months ago I had a problem with a very slow paying customer and I ended up in a position where I was short of cash, despite having over £21K in outstanding invoices with this client. They eventually paid up and I stuck the cheque in the bank.
I had (still have) an egg Loan and I called them up to let them know that my payment would be late that month because I was waiting for a cheque to clear.
That's all I said.
Their response?
They immediately cancelled all interest on the account (set the APR to 0%) and reduced my monthly payment from £188 to £50. I told them that this was only a temporary problem and that the cheque would clear in 4 days time. They weren't interested in anything I had to say and my loan account still shows an APR of 0%. I've paid off a lot more than the £50/month they asked for and there's nothing on my credit reports to show anything amiss - in fact, the payment history is flawless!
They didn't send me any confirmation of a 'special arrangement' or anything else - just the usual statement with an APR of 0%.
No idea why they chose to sacrifice £1000's in interest but I've certainly benefitted from their overreaction!
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