Money grouse: Frustration of Co-op changes

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CO-OPERATIVE Bank customer Brian Foster thinks the bank has done the dirty on him.

In February, the Co-op launched a new credit card called the Robert Owen card that promised never to charge a fee. But the Co-op gives some customers a shorter deadline than normal for settling bills.

The Robert Owen card charges three different rates of interest depending on how much debt a holder has.

The Co-op decided to switch 100,000 customers who had its Classic Visa to the Robert Owen card. These were people who used cards frequently and the bank reasoned they could benefit from the new card as the rate of interest on Classic was 1.9 per cent a month, against 1.7 per cent for those who spend more than pounds 300 on Robert Owen.

However, the rules of the Robert Owen card differ in another respect. With Classic, which charges a pounds 12 annual fee, customers benefit from up to 56 days' free interest if they repay in full.

The Robert Owen card gives 46 interest-free days to those who pay in full. People who only pay off part of their bill get up to 56 days, but the Co-op will charge interest on transactions from the day they hit the customer's account. The two different payment dates are stated at the bottom of each bill.

The Co-op insists it wrote to customers who were to be transferred to Robert Owen cards offering the chance to say 'no'.

Mr Foster recalls a letter telling him he would no longer pay a fee but did not realise there had been a change to the arrangements for paying interest until he was charged for it even though he paid his bill, in full, at the usual time.

He complained: 'The main problem is the payment date itself, which is before I receive my salary cheque.'

The Co-op redeemed itself after being contacted by Money Grouse. A spokesman said that although Mr Foster had been notified about the switch, there appeared to have been a genuine misunderstanding and the bank would refund the interest and change his payment date.

Write to Money Grouse, The Independent, 40 City Road, London EC1Y 2DB. Include a daytime telephone number. Please do not send SAEs or original documents.

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