Have you claimed back your credit card charges?

Over the past eighteen months we have all heard about the rows that have erupted between banks, campaign groups, and financial regulators relating to bank charges for unauthorised overdrafts, bounced cheques, and returned direct debits. Banks have been charging hefty fees for such oversights, sometimes amounting to close to £40 per fee. Campaigners have argued that banks only have to pay a few pounds for the administration of these oversights, yet are charging some customers up to ten times this amount. Financial regulators have stated that banks should not be making a profit from these charges, and have branded the fees unfair and unlawful.

As a result of this many consumers across the UK have reclaimed bank charges to the tune of millions of pounds in total, with some customers claiming back charges going back up to six years. However, banks have continued to argue that these charges are fair, and as a result of this a test case to determine what banks should be charging is due to go to court next year. Last year credit card companies went through the same sort of situation, and it was decided by financial regulators that card companies could not charge more than £12 per fee for late payments or exceeding the credit limit on the account. Prior to this some card companies had been charging double or even three times this amount for each fee.

Although many people have claimed back their bank charges going back up to six years, fewer people have bothered to claim back the charges applied to their accounts by credit card companies over the past six years, even though it has already been determined by regulators that no more than £12 should be charged. This means that if you have been charged anything more than £12 for credit card charges you can claim back the excess, which is some cases could be in excess of £20 per charge depending on how much your credit card company was charging previously.

As with bank charge claims you will need to contact your credit card company initially to ask for statements going back six year (or less if you have not been with the credit card provider for so long). You may find that you are charged for these statements but the cost should not be an unreasonable one. Alternatively you can ask for a list of charges that have been applied to the account along with reasons for the charges over the specified period. This is something that your card provider should issue you with within forty days, although don’t be surprised if you receive the information at the eleventh hour, as delays are not unusual.

Once you have received a list of charged you simply need to go through your statements carefully and identify any charges that have been applied for late payment, missed repayments, and exceeding your limit. The one thing to remember with credit card charges compared to bank charges is that the card issuer is allowed to charge up to £12 per fee. Therefore you need to calculate the different between the £12 and the actual amount that you have been charged for each fee. Once you have done this add up the amounts and this will give you the total that you are owed in back charges. It is also an idea to work out the interest that you have lost on the amounts charged, as you could also claim this back.

Once you have worked out the charges you should write a letter to the bank explaining that you want the money to be refunded to your card. You will find a number of sample letters that you can use online, and these include the legal jargon and information about regulations that the credit card companies need to be mindful of when deciding on whether to issue a refund. In most cases you will find that the card companies will offer a refund of at least part of the amount requested, but you may want to hold out for full payment.

Once you have written to the bank – and it is advisable to send the letter recorded delivery to ensure that it does not go astray – you should chase it up with a phone call after two weeks if you have heard nothing. However, you will often receive a letter stating that your claim is being looked into and that the card provider will contact you within a specified time period to advise you of the outcome. As with bank charges, if you have no luck with the credit card company you can take it further and you can contact the Financial Ombudsman Service to have your case looked into.