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Have you ever had a Vanquis credit card? Did you get a letter or email saying you’re due a Vanquis refund? Are you wondering if your refund could be larger?
Getting a Vanquis refund is great – but should it be larger?
Vanquis are sending a million people refunds. Really, a million! They are refunding people automatically who had ROP on their Vanquis credit card. ROP is a bit like PPI.
If you have ever had a Vanquis card and you had ROP, you will get some money back unless you always paid your credit card in full every month.
The Financial Conduct Authority has told Vanquis to do this because they didn’t explain that the ROP fee, which sounds quite low, is added to your credit card as a purchase. As a result, you were paying interest on it at between 40% and 70% compound interest, which adds up to a lot over time.
Good news for a million customers
That’s good news, especially as it is just being sent to you, you don’t have to ask for it. I wish more companies did this with PPI refunds!
If you still have a Vanquis credit card, you will get the news in an email and a refund credited to your account. Vanquis started sending the Vanquis refund emails out in June.
When all the open accounts have been refunded, Vanquis will start on the closed accounts who will get a letter and a cheque. They are aiming to finish by February 2019.
But… are the refunds too small?
Vanquis don’t say in their email to you how they calculated the refund, so you can’t check it. But there is a long example on their website.
Sara Williams, who blogs about debt, has been looking at this. She has written an article Vanquis’s ROP refunds are too low – it’s time to complain about the problems with what Vanquis are doing:
- They are using some of every monthly payment to pay off the ROP. But they should first be using your money to pay off the expensive interest on what you have bought. That would be the fair way to do this. Making you pay more in compound interest at Vanquis’s interest rate makes small monthly amounts add up to a lot.
- The calculations stop in late 2016, even though you are still being charged interest every month on the part of your balance that was ROP from before that date.
- They aren’t refunding over-limit charges. Even though they were probably caused by the ROP.
Sara thinks this affects everyone who didn’t normally clear their account balance every month. And the longer you have had the card, the more you should be getting. She says:
Some people are being given £30 or £40 when I think they should get hundreds. And a refund in the hundreds should be a lot more, possibly thousands if you had your card for a long while and it was often at the limit.
I asked Sara why she was so sure the refunds were wrong. She had been helping people get ROP refunds last year from the Ombudsman. This was before the FCA said Vanquis had to refund all customers with ROP, so she had seen dozens of refunds calculated at that point. And the interest refunded then was a lot larger than the automatic refunds now being offered from June.
What you can do
Sara has given a template letter in her article for you to send to Vanquis. You just have to add your name and card details and delete bits that don’t apply to you. For example, if you never paid over-limit charges, remove the sentence asking for them to be refunded.
Vanquis don’t agree they are getting the calculations wrong so they may reject your complaint. If this happens, you can send the same complaint onto the Financial Ombudsman. The Ombudsman will look at whether what Vanquis has done is fair.
Also, stop paying ROP
If you are still paying ROP, it will show up on your statements every month. It would be a good idea to cancel this as it is very expensive and poor value for money.
Without the ROP, a lot more of your monthly payment will be coming off your credit card balance. So if you have found it hard to reduce your Vanquis bill, ROP is probably one of the main reasons!
Hopefully, this is going to be useful to some of my readers! If you know someone who has a Vanquis card or may have been affected then please do share this post with them! Thanks so much to Sara for helping create this post, and more importantly – helping people get back the money that they are owed! If you’re looking to get a new credit card deal, and have a decent credit score, be sure to look at a 0% credit card or even a cashback credit card.