Questions of Cash: The Independent

Q.  In December 2008 I took out a finance agreement with Barclays Finance for two UPVC windows I ordered from Zenith Staybrite.  I could afford to pay in cash, but the salesman said that credit was cheaper – the finance company gave Zenith an ‘incentive’ payment, called the ‘Lifestyle subsidy’, for £204, which Zenith passed on to their customers.  I was told to obtain a settlement figure after seven months of payments and pay-off the debt.  But the settlement figure I was given was £976.36, which added to my £100 deposit and seven monthly payments of £17.04. made the total figure I paid £1,195.64 – which is £65.64 more than the ‘cash’ figure of £1,130.   In December I received a goodwill payment of £75 from Zenith, with a letter saying it did not accept responsibility for any problem.   JG, Winchester.

A.  Barclays Finance spokesman Andrew Bond says:  “It seems there was some confusion around the actual cost of the credit agreement, so to resolve this issue we have refunded the interest paid of £85.24.  I would like to apologise for this confusion, but would stress that we don’t feel there was any attempt to mislead the customer about the cost of credit.”  Taking into account the Barclaycard and Zenith goodwill payments your total cost of the window installation is now down to £969.76 – over £160 cheaper than if you had paid by cash.


Q.  A few years ago I suggested to my wife that she open an ISA with Alliance & Leicester.  On her annual statement for January 2010 we noticed that she had received a paltry £26.38 interest on over £11,000 of savings. I knew from the Independent’s savings tables that A&L paid one of the best interest rates on an ISA, but on checking I find this is only on the new issue.  JC, by email.


A.  Several readers have complained about the reductions in interest rates on ISAs taken out with Santander (formerly Abbey) and its Alliance & Leicester subsidiary.  Some have also questioned whether Santander is legally allowed to reduce interest rates on ISAs without individually notifying customers.  A spokeswoman for Santander says: “We have always informed customers of their rates and interest in the their annual statement.”  She adds: “Due to the global market conditions interest rates have been falling on savings.  As rates can change frequently, we are unable to inform customers individually of this change.  Therefore, we ask that customers check the rates on their savings regularly via our advertisements on our website, branch literature and national financial press.  The onus is on the customer to check the interest rates applied to their savings.”  However, this may be regarded as a breach of the banking standards code, which specifies that where there a significant fall in the interest rate paid on a variable rate savings account holding more than £250 then the bank or building society will contact the customer to advise of this “in a reasonable period of time”.  Until November last year the banking code was a voluntary code, without the force of law.  Where there has been a loss of interest and a consumer believes this is the result of a breach of the standards code this can be taken up with the Financial Ombudsman, which may take into account an institution’s compliance or not compliance with the standards code in adjudicating on a case.  Since November, the banking code has had statutory force.  The Financial Services Authority has also strengthened it and a new code comes into effect in May.   Santander’s spokeswoman says: “A requirement, following the FSA take over of the banking code in November, is to contact customers if there is any material change to the interest rate on their ISA, which we are now doing.”  When the new banking code comes into effect next month, banks and building societies must communicate to the account holder of detrimental changes in interest rates (as compared to the base rate) in advance of those rates becoming effective, enabling customers to move money to accounts with another provider.  Communication may be by letter, email, or text, according to what is most suitable for the particular customer. 


Q.  I am having difficult checking my credit status with credit reference agency Experian.  There is one item on my record marked ‘default’, while the others are shown as ‘satisfactory’.  There was a disputed bill with Tesco relating to a fraudulent transaction, which is now resolved.  But Experian is marking up the problem as being with Egg, which is why the matter is not shown as resolved.  I have already sent Experian a letter from Tesco to confirm that this disputed item has been cleared and requested that it be removed from, or corrected in, my credit report.  I also want to end my subscription of £5.99 per month for a credit report, which I don’t need other than to correct this error which should not take almost three months to do.  SB, by email.


A.  Experian says that it contacted Tesco earlier this month to confirm your explanation and Tesco “replied within a few days asking us to amend the account”. Spokesman James Jones explains: “This has been actioned and now the account is marked as settled with a perfect payment record.”  Experian adds that while it has cancelled your CreditExpert membership, you did not need to join its service in order to correct your credit status report.  “The law gives consumers the right to have errors rectified on any credit report they have received from us and there is certainly no obligation to continue monitoring your credit report just because data on it has been disputed,” says Jones.


Q.  I was unable to travel by Ryanair when my wife fell ill.  I tried to recover the taxes on the flight, but Ryanair declines to repay the taxes saying that its administration charge to do so is greater than the taxes charged.   MB, by email.

A.  Ryanair directs you to the conditions on its website, which state that ‘Government tax refunds are subject to a reasonable administration fee. If the refund amount is less than the applicable refund administration charge then no refund will be made.’


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