Need to borrow? Want to save?
Get fair, unbiased advice in a language you understand
so you make the right choice.
Egg Customer Cuts Cause Anger
(04-02-08) - With the office of fair trading (OFT) already in dispute with banks over unfair overdraft fees, the government have now called for an investigation into Egg’s decision to ban 160,000 customers from using their credit card.
In a move that was initially interpreted as a removal of ‘high risk’ customers in the face of an impending credit crunch, Egg(www.egg.com) have been bombarded with complaints from those who have been cut adrift. The alienated customers claim that they regularly pay their balance off at the end of each month, and pose no risk at all in terms of irresponsible spending.
Senior MPs have demanded an investigation amid concerns that banks prefer debt-prone customers who are more likely to run up high bank charges.
Egg, bought by US based Citigroup last May, had the following to say in response to customer dissent:
‘We are sorry and can understand that customers receiving letters are hurt and upset by this, but we stand by our decision. We’re confident the review undertaken was done in the best way possible and was effective in its findings. We are not getting rid of customers who don't make us money.'
Chris Eagle, Commercial Manager at CreditChoices, says the criteria by which credit card suppliers measure these culled customers needs to be clarified:
‘There has been anecdotal evidence over the last twelve months of this kind of activity, where credit card suppliers cull customers that they feel are non-profitable to them. I would welcome an OFT investigation into these practices, the process by which these customers were chosen needs to be made more transparent.’
