A TSB customer with a blameless credit record of more than 30 years has described her astonishment and anger after the beleaguered bank cut the £10,000 spending limit on her credit card to just £500, because she accidentally failed to pay a £2.97 bill.
Deborah Greaves*, from Twickenham, says she put up with weeks without access to her accounts earlier this year when TSB went into IT meltdown, and is furious that the bank took away the credit facility without warning. It then refused to restore it despite her repeated requests.
The 63-year-old banked first with Lloyds then with TSB following its split for more than 38 years and says she has never missed a payment. But she says she has come up against an absurd “computer says no policy”, and a series of staff members who are unable or unwilling to apply some common sense.
Even after Guardian Money intervened on her behalf, TSB initially insisted that it was bound by its rules as a “responsible lender” and it would not budge.
Her treatment once again throws the spotlight on credit limits, and the almost arbitrary way that banks appear to increase or reduce them for millions of customers.
Greaves possibly made a mistake by opting for paperless credit card bills, which meant she failed to spot that she owed £2.94 on her credit card account. She did not have a direct debit in place, and paid bills manually.
Banks take a dim view of customers who fail to make two payments in a row, seeing it as sign that a customer is financially distressed, even apparently for trivial sums.
When she didn’t pay the bill, TSB wrote to her to twice to warn her that it was outstanding and that her credit history was at risk if she missed a second month, but the letters didn’t arrive until 10 days after the second payment deadline had passed. The fact that the bank is struggling to deal with 100,000 complaints may have had something to do with this.
“I accept that I have made a mistake in thinking that the £2.97 balance was in my favour,” she says. “As my account had a series of bizarre credits from TSB on it from reward schemes which have been discontinued, it looked like a credit balance.”
She says staff have been sympathetic – one even advised to her to go to another provider – but no one has been able to restore it.
“Having a secure credit facility is really important to me. I travelled abroad to India in January and used my card continuously to pay hotel bills on behalf of myself and a friend, because it felt more secure than using a debit card. A £500 limit is not enough to plan and execute a holiday to Bournemouth, let alone India,” she says.
“After the way TSB has treated its customers this year you’d think they would be bending over backwards to keep their customers happy, but it’s been the opposite,” she says. “I’m really not one to move my account on a whim, but this has made me think it might be time for a new bank.”
If she does leave, she joins 26,000 TSB customers who have switched to a new bank since its massive IT meltdown in April, which has left it struggling with complaints about missed payments. Last month it suffered another, albeit much smaller, IT outage, and also announced the departure of its chief executive, Paul Pester.
Only after Guardian Money pointed out the absurdity of Greaves’s situation did the TSB head office agree to take a second look.
“The credit card limit was reduced automatically as a result of missed payments which is in line with our responsible lending policy,” says a spokeswoman. “Our team has taken a look into it and as a gesture of goodwill has reinstated her limit.”
* Surname has been changed
