Hiya,

This isn't strictly an issue with bank charges, but is closely linked so I hope someone can give me some advice.

I recently found out that the APR on my credit card has been incorrect for 9 years. Due to me having a royalties account with RBS and a credit card with them I should receive a discounted APR.

To cut a long story short, after alot of phone calls and poor information from them I spoke to a lady who said she would refund the overcharges of interest from the past 12 months. I declined and said that I wanted the lot back.

I am crap with credit cards and I have had a high account balance for years ( approx 10k - i know this is bad and intend on sorting it over the next couple of years). When I checked my bank account today they have put £67 back into my bank account. Does anyone know how I can work out exactly what they owe me?

My APR should have been 15.9 and they have been charging me 18.9. If it helps I pay about £132 in interest a month.

Does anyone know how I should go about this, I certainly think that £67 won't be the whole over charging.

Thanks in anticipation.

sal

x

Well if you've had it for quite some time and never fully paid it off, the interest will compound (you will end up paying interest on the last amount of interest charged and so forth, in a vicious circle). I would go through each statement and work out what the correct interest was and build it back from the very start.

Having had the card for so long, a small amount of additional interest charged some time ago will have compounded to be something much bigger now, so I doubt your payment even scratches the surface of it.

With each months statements, work out what it should have been and then find the difference with what they charged. Add this value to an aggregate total. Then for the next months statement, start with YOUR correct calculations of what you should have been charged rather than what they say you should have been charged, and do the same for that month - work out the difference and add it. Then with that new value, do the next month and so on.

Thanks. I don't actually have a reply from them at the moment, just noticed the payment into the bank account. I am going to wait for their reply and then ask for the copies of the statements they hold and also, how they have worked out the amount they have paid back.

To be honest their whole handing of the affair has been shoddy and initially they sent me two bottles of wine and just said sorry, we will sort it for the future!!!

I have had a call from the bank today.

They advised that over the past 9 years I have paid £6780 in interest. They advise that I have been 1% overcharged. ( should be 15.9 and I have been charged 16.9) They are therefore willing to offer me 1% back and have said that this is £67.80.

By my calculations they should be offering me more than that, because

6780 = 16.9 interest.

So 6780 divided by 16.9 = 401.18

Therefore 401.18 = 1% interest.

Do you think my calculations are right, or theirs?

To be honest I told her I wasn't happy and to go away and sort it out properly. I also asked for 9 years statements as above. Will see what they come back with.

Yeah what you're saying is basically right. Working out backdated interest is very complicated i don't know of anyone who has shown me how to do it accurately though. Your figure of £400 odds sounds more like it than their offer of £67.

According to the terms and conditions it's up to the customer to phone credit card centre, tell them they've now got a royalties account and get put on the new rate. (It never happens automatically)

Keep trying but as this is interest not charges i believe your best avenue of success would be to keep being persistent with credit card centre. 1% interest overcharged on the outstanding balance per year = closer to £400 & definitely not £67.

I think the problem is I joined Royalties when it was brand new, and was never sent any documents. I had a keyring thingy, which mean't that if i lost my keys they would come back to me.

They seem to accept this by actually agreeing to refund the interest, its just getting them to accept the fact that they owe me more than 1% of 6780 is going to be difficult.

To be fair if they don't get back to me today I am going to escalate it as the woman I am speaking to is a bit like an automated message service, I am fine asking her questions so long as they are ones she has anticipated and has answers for, if I ask her anything she hasn't anticipated then she has to go away and get another response.

Phone up and ask who would have authority to refund £400 worth of overpaid interest. Ask to be put through to them (don't hang up until you are put through) and explain the situation to this manager type. Tell them you feel you are being more than reasonable and that the figures speak for themselves. It is plain and obvious that if 18.9% interest applied over 6 years comes to £6,780 then it obvious that 1% interest you have overpaid is £6,780 divided by 18.9 = around £400.

They will offer a far smaller amount than £400. Don't worry though. Tell them that nothing less than a full refund of the £400 will do and as this is the amount they have overcharged you would not expect anything less. Whatever they offer you ask if that is their final offer (hey that sounds a bit like 'millionaire )

When they tell you their final offer:

Be firm but polite and say if that is all they are prepared to refund then you are left with no option but to go through the Financial Ombudsman Service (FOS) or even take court action to recover this interest the bank has overcharged you by. Then ask this credit-card manager type for the the contact details of the Ombudsman so you can write to them about the issue. Also ask for confirmation of their own name, position and also confirmation that this is a final offer.

(assuming they know their stuff they will also know that the bank gets charged somewhere between £300-£500 (seen different figures quoted by different people) each time the FOS gets involved in a dispute regardless of whether the customer is right or not. It's also totally risk free to the consumer. Any decisions the FOS makes the bank has to abide by and it doesn't limit you from taking further action.)

If the bank still won't budge (hopefully they will have by now) then by all means write to the ombudsman at the address provided. The bank has £300-£900 to lose regardless of the outcome. You have nothing to lose and £400 to gain.

Good luck.

Thanks for your advice, I work for an FOS regulated company and actually work in a role where I have the 'final' decision before it goes to ombudsman.

We are charged £550 when it goes to ombudsman, and thats just for them to open a case file.

I will let you know how it goes.

They rang again today, not really sure why. They were not willing to increase their offer and they have stated that the offer of £67.08 is correct. I have advised them to get a senior manager to call me back.

I think this will go on forever...

I just had a call, they siad they would refund me £385.55, soI have said yes, case closed.

excellent. result!

Excellent result, well done.

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