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Last Updated: Friday, 2 June 2006, 17:48 GMT 18:48 UK
Have Your Say: Credit card charges
A selection of Lloyds and Barclayclard credit cards
Barclaycard and Lloyds were among those to announce a cut
Almost all major credit card providers are cutting the fees they charge when payments are missed or credit limits exceeded.

Among those to take action are Lloyds TSB, MBNA and Barclaycard, who will reduce their charges from over 20 to 12 in the next two months.

In April, the OFT said default charges must halve or providers could face legal action.

But one of the providers has responded by saying interest rates for some card holders will go up.

We asked for your comments. This debate is now closed.

We have only been overdrawn once and that was 30 years ago. We have always stayed within our budget limits and pay off our credit card bills monthly. Obviously we are not the sort of clients banks and credit card companies want as we do not gain them any extra money except for the interest on our money in the bank.

Are we the only people to keep track of what is going in and out of our accounts?
If banks and credit card companies are forced to reduce the charges they make for people being over their overdraft limits or for not paying their credit card bills in time then we may end up being penalised.

Surely it is not beyond people to arrange to pay the minimum credit card amount directly by direct debit? Also are we the only people to keep track of what is going in and out of our accounts? I check ours regularly online. It takes only a few minutes and keeps me up-to-date with what is happening with our accounts.

Charges are in the terms and conditions which we signed up to when taking the card so why whinge about it afterwards?
John, Sheffield

I don't think 12 is OK. I recently got charged for not paying on time when my bill was posted to the wrong address. When I explained the circumstances to a member of staff she said it was very likely I'd get the charge refunded because of my account record. When I got my statement, the 25 was charged. I called again and was told "these charges are put onto accounts automatically by the computer". So, where are the costs being incurred by the banks?

I do not wish to continue to do business with them if they value my business so poorly
Debbie Ellen, Manchester
My charge was reduced by 50%, but I still feel this is extortionate when my balance owed was 102. Surely some sort of percentage fee system would be fairer than a blanket sum? I shall be writing to the bank as I do not wish to continue to do business with them if they value my business so poorly to impose even a 12.50 fee in such circumstances.
Debbie Ellen, Manchester

I think that charges and fines should be considerably higher in order to discourage irresponsible borrowing and credit taking. Lowering these charges can only encourage this irresponsible conduct.
A Freeman, London

People must pay reasonable costs for going overdrawn! However banks too should bear the costs of lending irresponsibly. The banks lend money too easily nowadays and when someone defaults they recover the costs by arguing high charges for collecting the debt and by penalising their wider customer base. Also the banks seem to lack common sense arguing for a large penalty charge for people going over their credit limit by a small amount, and then wanting to increase the same person's credit limit by thousands.
Andrew, Barnsley

Responsible customers shouldn't be penalised in favour of those who continue to miss payments. Some of the banks already take a stealth charge via our telephone bills by using expensive 0870 numbers for customer services.
Chris Grey, Guildford

I don't think it is unreasonable to face a charge for late payment. When you sign the credit agreement for a credit card you confirm that you understand the terms and conditions of its issue and use. If you don't read it then who is really at fault?
There is no excuse for a late payment given that you can pay the monthly minimum payment by direct debit
Jonathan, Aberdeen

Secondly, there is no excuse for a late payment given that you can subscribe to pay the monthly minimum payment by direct debit. Then the responsibility lies with the card supplier to apply for the required funds. Also remember that you can use the Direct Debit Guarantee to retrieve a payment from the card supplier if they take an unauthorised payment.
Jonathan, Aberdeen

I will be returning my credit card on the day I officially receive notification of the recent changes to the terms and conditions of the card issuer.

I was recently charged a late payment fee even though my payment was applied to the account one day after its due-by date, even though I submitted the payment one day earlier than stated on the statement and was delayed by the two days public holidays over Easter, and the late payment charge was applied to my account two days after my payment was posted.

Fortunately, my account is now clear and thus I can now dispense with my card rather than retain it as a temptation.
Martin Gosney, Barclaycard

I support the banks' charges for unauthorised overdrafts, exceeding credit limits and not making a payment in time. The first two amount to helping yourself to money that isn't yours, and can be avoided by setting up an overdraft or an increased credit limit.

Limiting the charges to recovery of costs means that there is no incentive for cardholders to abide by the rules
Colin, Cirencester
The third is a breach of the contract between the cardholder and the bank. Charges are a deterrent so that people who overstep their limits get the message to prevent them doing it again, rather like a parking ticket. Should these be reduced to the cost of an extra hour's parking, perhaps?

Limiting the charges to recovery of costs means that there is no incentive for cardholders to abide by the rules. In which case the rest of us, who do stick to credit and overdraft limits and who pay their bills on time, are subsidising those who don't. Where's the justice in that? If you can't stick to a credit or overdraft limit, and can't be bothered to pay the bill, you have to accept the consequences. Or cut up your cards.
Colin, Cirencester

I think that people need to realise that spending money that isn't there's should be penalised. If banks did not levy charges, people would spend the bank's money willy nilly, thus having a negative effect on us people who are responsible users of bank accounts or credit cards. No-one complains at being fined 60 for speeding or missing our parking ticket by five minutes!
Gordon, Dundee

I think a high penalty for going overdrawn is a good idea
Huw Davies, Newbury
Reducing penalties for bad money management can only encourage this poor behaviour. I think a high penalty for going overdrawn is a good idea. The banks and politicians should be discouraging debt, and poor monetary control, not encouraging it. Debt is a big problem for many people, and like smoking, is bad for them, therefore like smoking it should be heavily taxed.
Huw Davies, Newbury

You stay within your credit limit and pay at least the minimum amount by the due date and I believe you don't have to pay the 12. Decide to spend more money than they have agreed to lend you, or don't make payments when you should, and you get charged 12. Fairly simple choice really.
Stuart Smith, Wigan

I missed the payment day by one day over the Easter holidays and my bank have charged 25!
Terry Bransbury, London

I think 12 is fair amount.
Delia Jay, Bath

What about overdraft charges? My bank charges 30 for sending a letter even though the overdraft amount is minimal and there is credit payment in the system - often delayed by the banks ridiculous four days to transfer money.
George, London

Why should there be any charge? Going over your limit or making a late payment both result in more interest being paid, isn't this enough?
Peter, Bury

I've been in contact with my banks and one or two credit card companies. When I put the OFT ruling of a 12 threshold to them, they were more than happy to investigate - however one response was: they knew of no such ruling, they were within their legal right to impose these charges (20, 25 or 30 as the case may be), and as far as this issue was concerned, were not answerable to the OFT.
Emmanuel, London

I paid in 50 instead of 53.72 and was charged a 25 late fee
Christine, Skipton
I recently misread the minimum payment when paying cash (before the due date) in the bank and the teller didn't notice! So I paid 50 instead of 53.72 and was charged a 25 late fee.
Christine, Skipton, Yorkshire

My wife had a direct debit fail because she was 1 under the amount in her account needed to cover it and has been charged 39!
Franco Proctor, Plymouth

This very week I have cut up and returned my store card after forgetting to pay 5 and being charged 15. I wrote and asked for a refund which was refused. I've voted with my feet, which is the only thing banks and card issuers understand.
David Watson, Edinburgh

A couple of months ago whilst I was abroad, an unexpected direct debit was taken from my account. This was quickly corrected. However, the following month the bank levied a 30 charge, causing the account to again exceed the authorised limit, so the bank charged another 30 a month later.

I believe that the levying of these charges is immoral
David, Fareham
In short it is a self-perpetuating revenue stream for the bank, which has only been stopped by me increasing the amount paid in. Arguably I should have done this in the first place, but my job requires me to spend time abroad, largely out of contact with civilisation. I believe that the levying of these charges, particularly in this way, is immoral and the amount is bordering on extortion.

I have little doubt that the banks will find another way of making money if this particular avenue is closed to them. If they were not so necessary, I would do without a bank altogether.
David, Fareham

The comments we publish are not necessarily the views of the BBC but will reflect the balance of views we have received. It is helpful if contributors state if they work for any organisation relevant to an issue discussed. Readers should form their own views on whether messages published represent undeclared interests, or views prompted by a common source.

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