Nationwide: Credit card customers left in the dark

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Nationwide: Credit card customers left in the dark

Mon 14th Apr 2008

Credit card customers could have shelled out up to £500 million in unnecessary interest payments in the 12 months since it was announced that providers will have to highlight the order of payments they use, according to Nationwide.

In April 2007 the Department for Business, Enterprise and Regulatory Reform declared that credit card providers will have to display a message on every statement highlighting how payments are allocated, which will come into force this October.

Currently, Nationwide is one of the only credit card providers that does not allocate cardholders' payments to the cheapest debt first, which allows more expensive transactions to continue to accrue interest.

The building society is calling on providers to implement the changes now, rather than waiting for another six months until they become mandatory.

Jeremy Wood, divisional director at Nationwide, said: "Most providers apply payments to the cheapest debt first making it more expensive for the consumer and more profitable for them."

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