Unwanted credit card cheques

29/11/2007

Nearly 22.5 million consumers have availed a credit card cheque, this making the business a productive £660 million a year.

APACS finest practice strategy clearly specify that issuers should undertake correct checks to assess a clients appropriateness also ability to repay before sending out credit card cheques. During 2006, 326 million cheques were given to customers and over 4.1 million were actually used.

New research shows that 96 per cent of these were not sent for by the recipient, however really just 2 per cent were. 34 per cent of credit card holders receive this type of mailing two times in just one year, 9 per cent of these are almost bombarded and obtain a mailing nearly once every month.

Personal Finance Expert, from uSwitch.com explained: “Spontaneous credit card cheque mailings raise the big question about card providers’ commitment to responsible lending. In 2006, the OFT suggested that the practice of issuing unsolicited credit card cheques should be banned, but this was never implemented. In fact, the DTI ruled out the option, and instead imposed an ‘opt-out’.