Furious at MBNA and can they get away with this?

Yes they can. I can see their point if your regular amount is close to the minimum - I expect this is related to a wider problem they're having. There's absolutely nothing stopping you from making up the difference through a standing order though.

However, I hate MBNA with a passion so I hope you do manage to screw them.

I don't really see what they've done wrong. I thought DDs were always for the minimum payment only. Can you not just set up a standing order from your bank to make the payments each month?

So you've actually been paying more than you had to in order to try and clear the debt quicker, and they've gone and changed your DD so you'll now be paying only the minimum? And you've never missed a payment and so have never incurred default charges?

I don't understand why they would do that. It doesn't make much sense.

It does seem odd but, as Baron said, there's nothing stopping you making up the payments each month.

Baron my payments is an extra £400 a month. They're telling me they now want me to pay £80 so that they can charge me even more interest. It shouldn't be my problem to do a standing order.The only reason I can see is that they're prob not getting as much interest due to the credit crunch so are trying to get as much money as they can by whatever means. I don't think they can get away with that.

So ring them up and tell them to change it back. Or cancel the DD and set up a standing order for the amount you've been paying.

But you can still up your payments. I don't see the issue.

What BGB said - but it's not just MBwhatchamcallit, the Halixfax CC just did the same as a general policy for all holders.

Payment arrangments are usually for a period of 6mths - they may have stopped your usage on the card during this time?

Can't see any problem with what they have done - if your DD is for £80, you set up a SO for £400 - exactly the same.

What is their reason for doing this? and whoever else is doing it?

but anyway - you can still pay them more and it isnt really a problem unless they were to refuse your payments

i dont like them very much though

Zebra,that's fine about Halifax. That's their policy and since I started banking with them I accept that. . This isn't a changed policy with MNBA though. There's notrhing to say as agreed in my terms and conditions or anything like that. It's a cheeky way to charge me more interest and anyone else who got this letter. It annoys me that I'm actually trying to get out of debt and sort my situation out and they go and do this.

Just to add my pennys worth - I rang MBNA last week to ascertain why I was getting £12 late fee's every month - whilst on the phone to me the MBNA guy "dropped" into the conversation that he needed to change my £90 monthly payment back to the minimum payment as thier policy had changed, and advised me to call up each month to pay the difference.

I was annoyed then, but have calmed down since, I can see that they are simply trying to stay afloat in the credit crunch, albeit devously !!

Sara MBNA don't take payments over the phone unless it's a late payment.

Sorry, I think I misunderstood your original post but Halifax recently changed the definition of a minimum cc payment recently to up their profits on it (see below) - I don't pay my Halifax CC off by DD as I don't pay the minimum on it but I suspect if I had done, I'd have had a similar email.

I think I would just cancel the DD that's standing and set up a new one with my bank. They have to let you know if they tamper with it again...

(From moneysaving expert email - lowers credit cards minimum repayments... not good news... you may pay more! Beware.
If you’ve got a Halifax or Bank of Scotland All In One, Plus or Cashback credit card beware, it’s lowered the ‘minimum monthly repayment’. The Change: It was the higher of 2% of your balance or £5, it's now the higher of '1%' or 'the interest plus £5'. The impact: Roughly speaking anyone with a card charging under 25% interest, making just the minimum repayments will pay less per month, meaning it’ll take longer and cost more to clear the debt. An example: A £5,000 balance, under the old system would have been repaid in 38 years, costing £12,600, yet the new system jumps to 83 years and nearly £31,000 in interest! More info in the Updated Guide Minimum Repayments inc free calculator Related Articles: 0% for Purchases, Best Balance Transfers)

They do (unless they have recently changed that too) take over the phone payments, as i have paid this way before.

Instead of a direct debit cant you just set up a standing order payment, its easy enough to set up. Also if you do a standing order MBNA cant alter the amount you wish to pay.

Thats what the guy told me "you are entitled to call call up and pay the difference each month"

Plus, my actual card is with Virgin, for which financial services to virgin are provided by MBNA. My late payment letters come from MBNA but my statements come from Virgin?? Slightly confusing

Hmm I haven't seen a letter from Halifax telling me that (I don't use the internet banking) Thanks for letting me know I shall look into it on Halifax. I've just spoken to Mbna and the fella I spoke too agrees with me but says there is nothing I can do. I feel like writing in to complain as I really don't feel this is good enough. Had a letter came stating as agreed in my terms etc I would still be annoyed but I know I don't have a leg to stand on.

Thanks for teh suggestion reg cancellinga nd setting up another one with my current account. I didn't think of that. I'm going to fight them on this and will go with your suggestion Zebra.

Thanks

No it's not a new policy. I've used them for the last 5-6 years and they have never accepted payments over the phone.They will if its a late payment take it over the phone. Unless this has now changed but I wasn't informed when I called them just now.

https://forums.moneysavingexpert.com/discussion/3075/mbna-residual-interest-scam

Can't you just send them a cheque / pay by debit card each month ?

My credit card is set up so the minimum is taken each month (so no late fees) and then I pay the remainder online by debit card - I do this to give me the flexibility to not clear the balance occaisionally

I see what you mean TWR. If I could clear the whole balance believe you me I would. I upped my payments so I could clear it off quicker and also not have so much interest added on each month.But It's just the principle of it all. They want you to pay less so they can charge more interest and line their pockets even more. I just don't feel like this is fair.

Even if I was to make an extra payment it will be after when I've been paid and will take at least 3-5 working days to go through so thats 3-5 days of extra interest they get. It's a hassle on my part to go calling up and changing everything just because they fancy changing the rules.Yes it's clever on them but it seems rather dirty to their customers if you ask me. I could understand if I had missed any payments or made late payments but I haven't. It just doesn't seem fair.

How did you up the payment before? Can you not just do the same again now?

I see why your annoyed as your clearly trying to pay off the debt quicker that they may like, however, I would write to them stating why you are annoyed, and then pay the extra each month via DD, SO, over the phone or by cheque.

Cancel the DD, and set up a standing order for the account instead. I have an A&L CC (also managed by MBNA) and pay this way!

Lots of people have suggested that you set up a standing order for the difference, you could set it to go on the same day that you would normally make your payment then you will be no worse of than you were before. It shouldn't be any trouble at all to set up so can you not just do that?

I called them up and asked them if I could increase the payments. They were fine with it then even told if should I wish to increase or decrease the payments give them a call.Now they won't allow you to increase your DD they only want the min to be paid. I think the only way around this other than writing a letter is what zerba, numbnuts etc have said. Cancel the DD and do another one with my bank.

Thanks for all the replies and advice everyone and sorry if I've confused anyone by not explaining myself correctly.

Vx

Hang on - they won't let you increase the DD above the minimum payment? Now that's cheeky...

You definately need to set up another one with your bank to make sure you're paying what you want to.

Transfer your balance to another card?

Surely they can't stop you making more than the minimum payment every month? That makes no sense?!

FWIW - I had a letter in from Virgin this morning saying the same. I also pay above the minimum payment and never missed a payment etc.

I think it's a ploy to make people pay over a longer period of time. I will contact them to see if I can change the DD, or set up a standing order to pay the difference.

It just looks like a mailout - possibly to people who are paying their cards off too quick?!

(Glad to know I wasn't the only one!)

I had exactly the same thing, and I agree with you, I think they are rip off merchants.

I have a Virgin credit card, which is just really an MBNA card with a different label... I was paying a set sum each of quite a lot more than minimum each month because I'd done a 0% balance transfer and was paying it off more quickly... they contacted me and said from now on they were only allowed to set up direct debits of either the minimum payment or the full amount - nothing else in between.

AND - when the 0% transfer period expired... they upped the interest on the card to 27% ???.. the first month I got my statement I was horrified - called to complain - they said, "Oh, that's the standard rate after the 0% transfer but as you've phoned we'll put it down to 17% then".. I didn't even have to try very hard, they are obviously just banking on people not checking their accounts or not understanding them.