I took out an MBNA (then VIrgin) personal loan 4 years ago. The ease of the application at that time was good and the money came promptly. I am now told that you cannot get this loan via Virgin any more. I made payments regularly for 4 years and I now have another year to run. However in July last year I had problems due to the fact that somebody else owed me money and a payment was returned by my bank (NatWest). For this I received 38 pound charge from my bank and a default charge from MBNA. This happened again the next month (already therefore 126 in charges) and I was telephoned by MBNA where I live in Greece. I explained the situation and the girl was in fact sympathetic
and I made a payment by debit card then and it was decided to spread the other outstanding payment over 2 months on top of my regular payment. The lady then said that the 50 pounds in charges would be waived due to my good payment record in the past. However, in November 50 pounds extra was taken from my account on top of my regular payment, without warning.
In December 2008 I started to received default letters from MBNA in the UK, followed by Debt Collection letters from Mumbai. I emailed and wrote to MBNA saying that payments were being made on the 9th regularly. Again in January I received the same two letters, so I contacted again. Emails go ignored and letters take a month to respond to, so each time there was an overlap and the letters continued every month. Finally I received a letter from MBNA saying the matter had been investigated and no room for further discussion and that if I was not satisfied to contact the Financial Ombudsman, which I promptly did. They are obviously snowed under with complaints, but eventually a very helpful person there assisted me, who had been copied in with all correspondence/emails I had with MBNA. Eventually (due to receipt of correspondence from Ombudsman) a lady contacted me from MBNA to eagerly close the problem. In the meantime, MBNA had taken a completely different payment amount from my account (1.20 less) for some reason that could not be explained by them. I told them that in fact I must be 50 pounds in credit due to the extra taken in November. I had differing balance outstanding amounts from MBNA and the Debt Collection Agency in Mumbai and in fact the default letters from MBNA were dated 7 days before the payment due date! I was informed there was a glitch in the system, which did not show anywhere on my statement of payments. I calculated my own balance outstanding, which differed again. I was then informed that a manual statement would be done. This took over one week and conveniently incorrect default debits and credits had been removed. How can this be I wonder with a bank? Also, have you ever heard of a bank manually calculating balances in this day and age? I had thought of repaying the whole amount in January, but decided against as I have paid all the interest at the beginning of the loan and therefore it is of no real benefit to me to do this. However, had I done so, would I have paid the incorrect balance?
Eventually I was refunded the 50 extra payment taken in November by MBNA and I have now agreed a sum of 100 pounds through the Financial Ombudsman for inconvenience. I was informed by MBNA that my payment record would be adjusted to A1 with Credit Reference Agencies, as clearly this had been incorrectly marked against my file as I had been declined a credit card by RBS in the meantime. I have one month to wait for the 100 pounds or I have to revert to the Ombudsman again. I am not saying that is a good compensation, but to be honest was sick of the whole back and forth situation with MBNA and waiting weeks for any response. Hopefully I will not have to ask again for the compensation.
I would not recommend MBNA in view of the fact that they seem unable to produce correct computerised statements of payments and balances, which for such a large organisation seems very bad practice and I wonder if other people have been stung by this or had the same bad experience with customer service. The loan originated under the banner of Virgin, so this does not reflect well against their organisation either.
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May 4th, 2009
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