Martin Lewis has sounded the alarm for Barclaycard customers ahead of next week’s minimum payment changes, with a stark caution: “You’ll pay double.”
The esteemed BBC Sounds podcast host and a familiar face on ITV has alerted his followers on the now X social media platform, as well as subscribers of the Money Saving Expert newsletter.
Mr Lewis issued a dire warning: “Barclaycard customer? Warning it’s cutting minimum repayments from monday, which means many will pay DOUBLE INTEREST – see how to protect yourself…”
Starting from Monday 22 July, Barclaycard is slashing the minimum repayment percentage that numerous clients are obliged to settle each month.
Consequently, if you’re someone who typically pays only the minimum on your card and take no action, you’re poised to repay a reduced amount monthly.
Minimum repayments are inherently structured to prolong your debt duration, diminishing as your outstanding balance does and this latest reduction exacerbates the issue.
Barclaycard should have already notified you about this adjustment via written communication earlier in the year they commenced dispatching emails to customers back in April.
In a message directed at its clientele, Barclaycard described the alteration as one that “gives you more flexibility with your monthly payment”.
Furthermore, the company asserted that this initiative is aimed “to ensure customers are treated as fairly as possible”, reports Birmingham Live.
The Financial Conduct Authority (FCA), which imposes stringent regulations that all credit card issuers must adhere to, also governs stipulations regarding minimum repayments.
The FCA’s consumer credit regulations handbook clearly states: “…a firm must set the minimum required repayment under a regulated credit agreement for a credit card or a store card at an amount equal to at least that amount which repays the interest, fees and charges that have been applied to the customer’s account, plus one percentage of the amount outstanding.”
A spokesperson from Barclays, the parent company behind the card commented: “We regularly review our products and from July, some Barclaycard customers will see changes to their minimum monthly payments, alongside adjustments to the APR. Customers will benefit from a reduction in their minimum monthly repayment and the vast majority have no change to APR, while some will receive a decrease.”
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