Credit card lender MBNA has been slapped on the wrists for its poor treatment of customers struggling to make repayments.

The Office of Fair Trading (OFT) has threatened it with a £50,000 fine if the company fails to implement new measures for dealing with those in financial difficulties (see the Debt Problems guide).

An OFT investigation found MBNA's debt collection arm was not always making it clear it would accept token payments from those in the mire.

It also bypassed customers' appointed representatives, such as debt charities and debt management firms, even though its policy allows them to handle enquiries.

MBNA has therefore been ordered, from 1 January, to:

  • Make it clearer in letters to customers in financial difficulty that it will accept token payments.
  • Only contact customers with appointed representatives if the borrower or third party has given permission; or if no payment has been made and MBNA has tried, but failed, to contact the representative.

Ray Watson, from the OFT, says: "Our investigation found problems with the way MBNA communicates with customers in financial difficulties.

"MBNA has agreed that it will make its debt collection letters clearer and clarify its policies and procedures for dealing with appointed representatives."

An MBNA spokesperson says: "We have agreed to deliver greater transparency in some of the communications we have with our customers in financial difficulties.

"We believe these changes are enhancements to our existing strong practices; we are in the process of implementing them now."

Further reading/Key links

Get help: Debt Problems, Mortgage arrears and Redundancy guides
Cut credit card debt: Best Balance Transfers, Long Term Balance Transfers, Credit Card Shuffle

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