3 November 2015
Chris Rhodes, Nationwide Building Society’s Retail Director, said: “We have been calling for greater transparency across the industry to make credit cards fairer and simpler to understand for customers. Therefore we welcome the FCA’s review of the credit card market and look forward to the full findings next spring. We welcome working with the FCA to continue providing a valued service for our customers.
“While it is positive news the FCA determines in its interim report that competition is working “fairly well” for consumers, a number of issues have been raised to make the credit card market more effective. Nationwide has a history of doing the right thing for its credit card customers and is pleased to see the FCA reflecting some of our customer-focused policies in its recommendations.”
Nationwide continues to review the way it offers credit cards so that customers are given a valuable product that consistently sets the standard for fairness, transparency and long term good value.
Positive changes have included:
- When Nationwide first launched a credit card in 1997, it became the first major provider to offer a positive order of payments, meaning the most expensive debt is paid off first. This was subsequently introduced as standard practice across the industry by the regulator.
- The Society already adopts opt-in credit limit increases, a recommendation in the FCA market study. The majority of the industry has an opt-out approach.
- Recent statement changes allow customers to see what interest they are paying on each balance and how long they have left on any promotional offers. This information is also available at any time via Nationwide’s Online Bank.
- Nationwide became one of the first providers to offer soft quotes on credit cards, meaning customers are aware of their credit limit and the interest rate they would be charged, if accepted, before applying for the card – thus giving them the opportunity to shop around without impacting their credit score – a key finding from the FCA
- The FCA has also suggested customers should be required to actively opt-in to permitting “over the limit” transactions, a service that many providers charge a fee for. Earlier this year, Nationwide called on the industry to follow its lead after removing the over limit fee. The Society also enabled customers with a balance transfer to make additional purchases without incurring interest charges on the total amount owed.