MSE News

MBNA credit card customers wrongly chased for 'overdue' bills after agreeing payment holidays

MBNA credit card customers wrongly chased for 'overdue' bills after agreeing payment holidays

MBNA credit card customers who agreed a payment holiday because they are struggling due to coronavirus have been mistakenly sent text messages chasing 'overdue' payment. If you're received one of these texts you can safely ignore it – so long as you're sure your payment holiday has been confirmed.

Credit card firms are offering customers who are struggling due to the pandemic and who ask for help payment holidays of up to three months. A payment holiday is where you take a break from paying your bill, so don't need to make monthly payments, though interest will continue to rack up in the interim.

Yet MoneySavingExpert.com has seen reports from a number of MBNA customers who've agreed a payment holiday, but have this week been chased for payment anyway. MBNA says the text messages warning of 'overdue' bills were sent in error and those who've agreed payment holidays don't need to take any action. It wasn't able to confirm how many customers are affected, but it's understood to be thousands.

For full help on credit card payment holidays, plus much more, see our Coronavirus Finance & Bills Help guide.

'It's quite alarming and impossible to get through on the phone'

MoneySaver Paul was one of those who contacted us about this issue earlier this week. He said: "I arranged a payment holiday for my MBNA credit card because of coronavirus causing me financial difficulties.

"They sent a text last week to say it had been applied, but today sent me another saying my account is overdue and charges may apply. It's quite alarming and impossible to get through on the phone."

Here are a few of the other reports we've seen from customers:

I've received one of these messages – what should I do?

If you've received a text message from MBNA chasing payment, you can safely ignore it – but only if you're certain that a payment holiday has been agreed and have written confirmation, either via text or a letter. Don't assume that a payment holiday has been agreed just because you've applied for one – if one hasn't yet been agreed and you miss a payment, it could lead to late charges and a mark on your credit file, damaging your creditworthiness.

An MBNA spokesperson told us: "Some of our customers may unfortunately receive this message due to the timing of when their payment holiday was set up.

"We appreciate this may cause confusion and are working to address this as quickly as possible. Customers do not need to take any action and there have been no changes made to their agreed payment holiday."

The firm says all new alerts sent from Thursday 23 April onwards have been amended, and while those who've agreed payment holidays may still receive this kind of text message, the message has been amended to explain that it can be ignored if a payment holiday has been agreed.

What is a payment holiday and how do I apply for one?

If you're struggling to pay an existing credit card due to coronavirus, your provider should give you a payment holiday – a break from paying your bill – for up to three months, or offer an alternative way to help.

DON'T just stop paying though – you must arrange a break with your lender first (you've until 14 July 2020 to request it). Provided you've agreed it with your lender, these payment holidays then can't hurt your creditworthiness and won't come with any penalties or charges.

It's important to understand that you WILL still be charged interest during a payment holiday, so will likely pay more overall. It's therefore best to only do this if you need to – if you can afford to pay, it's better to keep doing so.

See our full lender-by-lender credit card help for the latest updates, full information and how to apply.