Cahoot charges for paying before payment date

[Surfer01]

I have had a Cahoot Credit Card for several or more years with no issues and have never missed any payments although there may have been one or two instances in the early years where I paid late. Sometimes I pay the minimum but more often than not over and above the minimum payment.

I cancelled the DD years ago and have been paying ever since by Standing order as I pay early and also by money transfer from my current account which is with another bank. My payment date is on or around the 15th of every month but invariably I pay on or around the 1st of the month so in effect I am paying in advance.

Recently Cahoot over the past two months have been adding a charge of £12 to my account stating that I am paying late and not enough because they state I am not paying on the 15th of the month by DD. They state that it is part of my agreement that I should be paying by DD but they have been quite happy to accept payments by SO for several years.

On querying it I got the following reply;

Thank you for contacting cahoot in Coventry. As part of the terms and conditions for this account a direct debit needs to be active to collect payment. You are able to make manual additional payments into the account; if we receive your additional payment after your monthly statement's been issued we won't collect your direct debit unless the additional payment is less than the minimum payment or we receive it less than 4 days before your direct debit's due. If we are not receiving the minimum monthly payment you will incur a charge and these are valid. Your account is now with our Collections and Recoveries Team, they can be contacted on 08456070004 from 9am-5pm to discuss this with you. If you require any further assistance please do not hesitate to contact us again.

As I am paying more than the minimum payment, they shouldn't be activating the DD anyway although I do not have a DD set up! The above I received after I queried a negative response to an earlier email. Conveniently they close shop at 5 pm so it is difficult to contact them during the day by phone.

I have advised them that if they persist with this issue, I will request a true copy of my CCA, they will be sent a SAR etc etc. I am of the opinion that if it did go to court they are going to look pretty stupid charging a penalty because a customer is paying early and by other means than a DD and that fact that the DD is not effective when paying early. Can any one offer any other advice to get these morons off my back?

[yourbank]

I have had a Cahoot Credit Card for several or more years with no issues and have never missed any payments although there may have been one or two instances in the early years where I paid late. Sometimes I pay the minimum but more often than not over and above the minimum payment.

I cancelled the DD years ago and have been paying ever since by Standing order as I pay early and also by money transfer from my current account which is with another bank. My payment date is on or around the 15th of every month but invariably I pay on or around the 1st of the month so in effect I am paying in advance.

Recently Cahoot over the past two months have been adding a charge of £12 to my account stating that I am paying late and not enough because they state I am not paying on the 15th of the month by DD. They state that it is part of my agreement that I should be paying by DD but they have been quite happy to accept payments by SO for several years.

On querying it I got the following reply;

Thank you for contacting cahoot in Coventry. As part of the terms and conditions for this account a direct debit needs to be active to collect payment. You are able to make manual additional payments into the account; if we receive your additional payment after your monthly statement's been issued we won't collect your direct debit unless the additional payment is less than the minimum payment or we receive it less than 4 days before your direct debit's due. If we are not receiving the minimum monthly payment you will incur a charge and these are valid. Your account is now with our Collections and Recoveries Team, they can be contacted on 08456070004 from 9am-5pm to discuss this with you. If you require any further assistance please do not hesitate to contact us again.

As I am paying more than the minimum payment, they shouldn't be activating the DD anyway although I do not have a DD set up! The above I received after I queried a negative response to an earlier email. Conveniently they close shop at 5 pm so it is difficult to contact them during the day by phone.

I have advised them that if they persist with this issue, I will request a true copy of my CCA, they will be sent a SAR etc etc. I am of the opinion that if it did go to court they are going to look pretty stupid charging a penalty because a customer is paying early and by other means than a DD and that fact that the DD is not effective when paying early. Can any one offer any other advice to get these morons off my back?

 

To be honest, I would ask them for a final response and take it to the ombudsman on the basis you have written above. To be totally honest, whether it is in the terms and conditions is irrelevant to what was happening in reality and that you were not having problems prior to the date they decided to impose the £12. Just make sure 100% that you paid over the minimum amount and that it was received on time(just to be certain) and then I would complain to the FOS. I think from what you have written that it is unreasonable what they have done based on the facts you've written.

[Surfer01]

They are charging me the £12 penalty because I am paying them on the 1st of the month and the 1st of the month is the statment date and the payment is allocated to the previous month therefore I am now paying late according to them

It seems that this new faster payments now works against me as previously I paid on the 1st but it only hit their account two or three days later. Now it is the same day which is why this problem has only cropped up now in the last two months. I have altered my payment date to the 2nd of the month to avoid any more hassle but as sure as nuts I am going to hassle them all the way for my £12.

I used to hassle them to set up a DD to take the funds from my account on or around the 1st of the month, but they are insisting that it has to be on or around the 15th of the month which is why I use a SO to pay the account.

[yourbank]

They are charging me the £12 penalty because I am paying them on the 1st of the month and the 1st of the month is the statment date and the payment is allocated to the previous month therefore I am now paying late according to them

It seems that this new faster payments now works against me as previously I paid on the 1st but it only hit their account two or three days later. Now it is the same day which is why this problem has only cropped up now in the last two months. I have altered my payment date to the 2nd of the month to avoid any more hassle but as sure as nuts I am going to hassle them all the way for my £12.

I used to hassle them to set up a DD to take the funds from my account on or around the 1st of the month, but they are insisting that it has to be on or around the 15th of the month which is why I use a SO to pay the account.

 

The question is about whether it is received on time. For example, my payment date for a credit card with NatWest is say 18th, now if I transfer on the 18th then it is there on time because of Faster Payments. That is the question I would be looking at answering. If it is received on time then you have a case. If it has been paid as usual and it is not falling on the weekend then they have to refund and stop acting like idiots towards you.

[Surfer01]

As far as I am concerned they received the payment on the 1st of the month with the payment date being on the 15th of the same month, however as it is received on the 1st it was allocated to the previous month as their month starts on the 2nd of the month. Makes me wonder how many other people they have caught out like this. Over the weekend I will daft a letter to their head office as the numpties at the so called csutomer service centre have never faced this sort of situation previously and all they can do is refer to the T & cs and state that you have to have a DD set up! Their website states the following;

repayments

Each month on or before the payment date you have chosen you must pay at least the minimum payment set out in your cahoot credit card statement. The minimum payment will be the greater of:

£5 (or the full credit card balance if it is less than £5); or

2.5% of the credit card balance.

The payment date is the day which falls 15 days after each statement date on or before which we must have received the minimum payment under the cahoot account terms and conditions. The statement date is the date set out on your cahoot credit card statements.

When I copied and pasted it in the email, they did not even refer to it in their reply. This a total online account. Time to get tough and give them hassle like they have never had before all for the sake of £12 as the £12 is not a mandatory charge. In addition as it is an online account, it makes me wonder if they still have a copy of the CCA after all these years. They will also have a hard time explaining it to a judge how they arrived at this figure when my payment was on time.

[yourbank]

The argument I would use is I have always paid on this date at this time and there has never been a problem before. If they aren't clear which date the payment is due by, ie they don't tell you then how the hell are you supposed to avoid their charges. You will win on this one.

[Surfer01]

Thanks.

[Carningli]

Dear Surfer01,

I notice that you have not posted since July 2009. However I am interested in your situation as I find myself in a very similar one. I have both a Flexi Loan, Credit card and Savings Account with Cahoot. About 6 months ago I asked my current account holding bank to stop (As is my right) the DDs in respect of the Flexi loan and Credit card. I also noticed that BACs payments made in respect of the current months payment due were being credited to the previous month. I rang Cahoot to find out what was going on as I was incurring late payment charges and was informed that payments received prior to 4 (working?) days before the original DD lodgement date, were credited to the previous month. A nice little earner me thinks and a trap for the unwary. Cahoot used to be a well respected on line bank, but by their recent actions seem to have joined the sharks.

 

I would be most interested to know how your case has progressed?

 

Carningli