Saturday 17 February 2018

Credit card firm hikes its interest rate by one-third

Charlie Weston Personal Finance Editor

ONE of the largest credit card operators in the country is increasing the interest it charges by almost a third.

Thousands of customers are set to be hit after MBNA, which is now called AvantCard, confirmed that the rates were rising.

The higher costs will take effect over the next two months, letters sent by the company indicate.

The move means the rates charged for buying goods on the credit card will jump from 13.9pc to 17.9pc. This is a rise of almost a third.

Charges for withdrawing cash on the AvantCard credit cards will now be 22.9pc, up from 17.9pc.

Spain-based AvantCard took over MBNA's Irish card operations last year.

In the letter to customers, the card provider said it periodically reviews the interest rates it charges, based on the current economic conditions.

"We have recently undertaken a review and confirm that we will be making changes to increase the standard variable interest rates applicable to your account no earlier than two months from the date of this letter," it said.

CHANGING

MBNA, which is owned by Bank of America, was one of the biggest credit card issuers in the Irish market, operating from Carrick-on-Shannon in Co Leitrim.

MBNA was bought over last year by an American firm, which transferred the Irish card operation to its Spanish unit, and has been in the process of changing its IT systems.

It has not been taking on new customers while the change-over is bedded down. Earlier this year the Central Bank said it was working with Spanish regulators to end disruption to thousands of credit card holders with the former MBNA, caused by an IT changeover.

Customers have been unable to access their accounts online, change direct debit details, register new cards and are having transactions refused.

Some also say they have not received either a hard copy or a digital account statement for March.

This comes just weeks after the new owners of MBNA, Avant Tarjeta, switched the former MBNA Ireland credit card business to its AvantCard unit.

Customers were notified, via a leaflet posted to them with statements in February, that the account changeover would take place in March, and that there might be some disruption.

Irish Independent

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