So as you probably know, there’s a lot of ex-Egg people around Zopa, and generally we have at least some residual affection for the place.
I just got an email from them that makes me fume and rant.
They’re changing their T&C’s on the Egg Card, which once upon a time, was an excellent credit card. The latest money grabbing, shameless and diabolic trick is to charge customers £0.50 in interest - even if the interest amount is less than £0.50!
To quote from their web page
The changes to Conditions 4.5, 8.1, 21.1, 21.3 and 21.5 come into effect from 1 September 2006. The changes can be summarised as follows:
Condition 4.5 has been added to provide that where interest is payable, a minimum amount of 50p will be charged, even where the interest amount is calculated to be less than 50p.
What this means in cash terms is that if you have a balance of less than £40, and don’t pay it off in full (Even if you pay £39.99) you’ll end up paying extra interest.
For example, your statement shows a balance of £20, and you only pay the minimum balance. Because you don’t clear your balance, you’re charged interest on the full £20 (and not the £20 - £5 min = £15 remaining balance).
Now, a 15.9% interest rate is equal to a 1.23% monthly interest rate - and 1.23% of £20 is 25p. But because you’re a special Egg customer - you’ll get charged 50p.
Fine - doesn’t sound much - but multiply that up by some percentage of Egg’s c. 3M Egg card customers, every month, and I bet you’ll get to a decent sum…straight to the bottom line.
Personally, I think it’s disgraceful when financial services organisations take advantage of customers like this - how many Egg card users will actually read the changes to their T&C’s and then then understand the implications? Not many I suspect.
Me - I’m paying off my (small) Egg card balance, and closing the account as fast as I can get out of there.
EDIT: Just for good measure I thought I’d go and take part in the Money Saving Expert discussion about the same issue