Balance increasing despite making minimum payments

[booed1]

Please can someone give me advice on this one as it doesn't sound or feel right to me. A friend of mine has an MBNA credit card which he no longer spends on (hasn't for over a year now).

Due to financial difficulty, he can only make the minimum payment which he has done on time every month. The bit I don't think is right is that his balance is increasing month on month due to interest and charges. Surely the minimum payment is supposed to cover these and what is the point of a minimum payment if you never reduce the debt?

He phoned and asked them and they said that it is what it is...

I feel a complaint to FOS is in order but I don't want to get his hopes up and was just wondering if this is really the case and they are well within their rights to charge this way.

thanks

[leclerc]

Re: Balance increasing despite making minimum payments

Please can someone give me advice on this one as it doesn't sound or feel right to me. A friend of mine has an MBNA credit card which he no longer spends on (hasn't for over a year now).

Due to financial difficulty, he can only make the minimum payment which he has done on time every month. The bit I don't think is right is that his balance is increasing month on month due to interest and charges. Surely the minimum payment is supposed to cover these and what is the point of a minimum payment if you never reduce the debt?

He phoned and asked them and they said that it is what it is...

I feel a complaint to FOS is in order but I don't want to get his hopes up and was just wondering if this is really the case and they are well within their rights to charge this way.

thanks

Is he making the payments on time?
Do they have any form of payment protection?
The minimum payment SHOULD cover any interest on the account so are they paying their bill on time each month, ie a few days before the bill is due or via Faster Payments online?

[booed1]

Re: Balance increasing despite making minimum payments

He pays by direct debit so the funds are received well within the time limit and there are no other charges to incur. The balance is going up.

I think its time for FOS.

[leclerc]

Re: Balance increasing despite making minimum payments

Can you check with him if he has got Payment Protection Insurance or Income protection directly linked to the credit card?

[MIKE770]

Re: Balance increasing despite making minimum payments

Trouble with MBNA, if they are claiming PPI they are still being charged a monthly fee, other companies I have dealt with have not done this, hence my OH account went up every month she had to claim (that was a pantomime (claims proceedure)), The PPI company say it is MBNA and MBNA say the PPI company, so you are possibly left with PPI not covering repayments.