MoneyExpert: Industry Heads Off Criticism With Credit Card Cheque Changes

The terms and conditions applied to credit card cheques are to be clearly stated following a public and regulatory outcry over the way in which they are marketed.

Credit card cheques allow card holders to draw on credit card funds when paying for services which are unable to take card payments.

They have been the subject of a long campaign by consumer groups and are being investigated by the Department of Trade and Industry over the way that they are supplied, however.

Of the 144 million cheques which have been issued, 98 per cent are believed to have been sent unsolicited, offering to provide large loans while explaining few of the terms.

The cheques often incur interest payments of 20 per cent or more, are subject to handling fees, and do not offer the same consumer protection as credit card purchases.

“They are a deliberate attempt to get people to use up their credit lines,” claimed MP James Plaskitt, during a debate on the Consumer Credit Bill last year.

“The case for their very existence is weak – the case for their unsolicited issuing is just non-existent,” he added.

From the end of September all such cheques will feature full terms and conditions, allowing borrowers to accurately compare credit card cheques across the market.

This article: © Moneyexpert Ltd.

Leave a Comment

Your email address will not be published. Required fields are marked *