MBNA told to be clearer to customers in difficulty

Credit card lender MBNA has been told to improve the way it handles customers in financial difficulties after an investigation uncovered poor treatment of people struggling to make repayments.

The Office of Fair Trading (OFT) yesterday accused the firm of failing to follow its own procedures when dealing with customers who had appointed debt management companies to negotiate on their behalf.

It also said that MBNA, owned by Bank of America, had not made it sufficiently clear to customers who were offering token repayments whether their proposals had been accepted.

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The investigation was launched after Citizens Advice raised concerns over the way in which MBNA's debt collection operation was treating customers in financial difficulty. MBNA co-operated fully during the investigation and was in the process of addressing the issues, according to the OFT. It said that from 1 January the lender must make it clearer to struggling customers that it will accept the repayment amount they have shown they can afford to pay.

It must also stick to its policy of only contacting customers who have appointed a representative when either party has given it permission or confirmed that the representative no longer acts for the customer, or where the expected payment has not been made.

Ray Watson, director of the consumer credit group at the OFT, said: "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."

A spokesman for MBNA said: "As a result of ongoing dialogue with the OFT we have agreed to deliver greater transparency in some of the communications we have with our customers in financial difficulties."