I am exasperated with customer service at Tesco Bank over my credit card. I have been an expert juggler of credit cards for many years, always opting for 0 pc balance transfers, as I do not intend to give away me and my husband’s (the founder drummer of Status Quo) hard-earned cash.
But, recently, I checked my Tesco app and saw I had been charged £119 interest on my credit card. As I always pay off the balance by direct debit plus extra lump sums, when necessary, I knew this could not be right. It has been a nightmare trying to sort this out, and meanwhile I have been charged yet more interest.
G.C., Oxfordshire.
Sally Hamilton replies: From the opening verse of Status Quo’s 1979 hit Whatever You Want came to mind: ‘You pay your money. You take your choice.’ Except you seemed not to have any choice over the unwanted interest.
Zero pc interest credit cards come in three distinct types: those charging 0 pc interest just on balances transferred from other cards; 0 pc on purchases only; or 0 pc on both transfers and purchases.
Your Tesco deal falls into the first category. It is a 12-month zero interest balance transfer card, which means only the £6,000 balance you moved from your Barclaycard was eligible for the 0 pc interest. This meant you could spread repayments of the debt over a year at no cost other than a £210 balance transfer fee.
You played your cards right for nine months – until September. By then you had roughly £2,200 left to pay off at no interest by early January 2025.
However, at that point you used the Tesco card to pay for flights to Australia costing £4,500. But you did not want to affect your 0 pc balance transfer deal, so swiftly paid off the Tesco balance with your Barclaycard.
Soon afterwards you spotted the rogue £119 interest charged on your account and in a panic called Tesco. After explaining what you had done it agreed to refund the interest – but only by first refunding you the ticket price to your Barclaycard. This seemed a complex way to resolve matters. Meanwhile, you saw more interest added to your account.
I stepped in to ask Tesco if it could untangle the situation before the interest mounted further. It did this within a day, declaring it had done nothing wrong and had simply followed your card’s rules to the letter.
It explained that the payment from the flights from your Barclaycard was made to the Tesco account too early – before your Aussie flight ticket purchase was billed to your statement.
This resulted in the Barclaycard payment being applied to pay off the remainder of the outstanding 0 pc balance transfer rate amount and resulted in a purchase balance of £2,234. It was the latter balance which attracted the £119 interest.
A Tesco spokesman says: ‘The interest payments were applied correctly, as outlined in the “payment allocation” section of the monthly statement. However, this was not the outcome the customer intended when they made the payment. We have, therefore, taken a number of actions to resolve it, including a refund of the interest.’
It went further by treating the £2,234 debt as a balance transfer and has extended your 0 pc deal for an extra 12 months to allow you to spread the repayment cost. It added £75 as a further goodwill gesture. You were delighted.
My 100-year-old friend is a blind Second World War Navy veteran who relies on his TV to listen to the news and his favourite comedy programmes. He also relies on his telephone as he lives alone in the council flat that he and his late wife moved into in 1976. Until this month he was paying about £36 a month for his Virgin Media service, which he thinks is an acceptable sum. But when his contract came to an end this month, he was told it will rise to over £70.
I called Virgin Media on his behalf. They sympathised but offered only to reduce it to £60. After a further attempt via the retentions team this was reduced to £53 a month for 18 months, after which it would rise to £76.
Please can you persuade Virgin Media to reverse this increase.
K. B., Bolton.
Sally Hamilton replies: It is normal in telecoms – and other markets – to win customers by offering introductory rates for a set period, only for the price to leap when the deal period ends, typically after 12, 18 or 24 months.
But it requires customers to be on the ball at renewal to ensure they do not end up paying over the odds.
I am the first to say it is important to haggle. Having just received a nasty renewal quote from the AA – 74 pc higher than last year for my car breakdown cover – I am rolling up my sleeves to do just that. And if that does not work, I’ll take my custom elsewhere.
But negotiating with providers can be a downright hassle, and someone who is 100 and visually impaired should not have to play hardball with their provider, especially as a loyal customer. So I asked Virgin Media to investigate. It acted swiftly and offered to reduce the bill to £35 a month. Your friend was warned that this will rise to £72 after 18 months, but Virgin Media confirmed the deal could be renegotiated then.
Incidentally, people are on a low income, may be able to pick up a cheap broadband service from their current provider for as little at £10 a month – but customers will have to be on benefits such as Universal Credit to qualify.
Virgin, which has two offerings at £12.50 a month and £20 a month, says it regularly sends reminders to customers to check their eligibility. Your friend would have received an alert when his recent contract ended. However, the social tariffs would probably not have suited him. These services are limited and in Virgin’s case would not include the landline and TV package he relies on.