Vanquis was told by the FCA in February 2018 to refund £168million to customers. This was for the extra interest charged on its ROP product that people were not told about.
It said it would refund existing customers within 90 days, then closed accounts within 180 days.
But since then there have been huge delays and now Vanquis is refunding some closed account before the open accounts.
This matters! Open accounts are still paying Vanquis’s high rate of interest, so every month delayed means more income for Vanquis.
ROP refunds- the sorry saga so far…
On the original 90 & 180 day timescale, the refunds should all have been finished by now!
Instead there have been major delays. It was obviously much more difficult than Vanquis had expected.
In May 2018, the 90 day target was missed by a mile with hardly any refunds paid. Vanquis announced it was planning to refund most accounts “by the end of the summer”.
In June and July things got worse when it became clear that many of the refunds being sent were a lot smaller than people expected:
- people weren’t getting a refund of any over-limit charges – which will normally have been caused by the extra interest charged;
- Vanquis is breaking some FCA rules when it works out how much of the interest to be refunded is paid off every month. These wrong calculations reduce the interest Vanquis should be refunding;
- Vanquis is ending the calculations too soon.
Basically Vanquis’s calculations seem to be wrong, and always too small!
As time went on there was no sign of the refunds to existing customers being completed by the end of the summer.
As I pointed out in Vanquis is profiting from delaying refunds, every month an existing customer’s refund is delayed is an extra month of interest Vanquis charges them on a balance which is too high.
Provident Financial said in its Trading Statement on October 19th that:
The Vanquis Bank refund programme to some 1.2 million current and past ROP customers is progressing well and is on-track to be substantially completed in early 2019. Following completion of a pilot into a small segment of customers in June, the refund programme is now in full roll-out and approximately 300,000 customers have so far been refunded.
It’s hard to see how only refunding a quarter of the customers at a point where you had planned to refund them all is “progressing well”.
But now some customers with closed accounts have had refunds
It was a surprise when these comments were left by readers in the last week:
I finally received my letter this morning and a cheque for a refund of the interest. £2200! I opened my account in 2007 and had ROP until I paid off my account and closed it in January this year.
We have just had £1300 refunded we had paid off account 3 months ago and didn’t even know anything about this until cheque came in post.
I can’t think of a good reason why Vanquis shouldn’t have completed the refunds to current customers first.
It would have been the fair thing to have done. And it should be simpler to refund existing customers because Vanquis knows where they all are and many will just get a reduction on their account balance. Closed accounts are more difficult, as the customers may have moved, or got married and changed their names, died etc.
Readers with open accounts are understandably not impressed by this change of direction by Vanquis:
Another misleading statement from Vanquis.
hey the longer they continue to keep current customers balances high, the more money they make off us in interest. It’s so wrong, but that doesn’t surprise me with this company at all. All interest should have been frozen until refunds were completed, that would have been the fairest thing to customers.
Have you had a refund and you aren’t sure it is right?
Your first thought is probably to be pleased… but read Vanquis ROP refunds are too low – it’s time to complain .
Some customers have already got larger payouts after using the template letter in that article to complain and there are a lot of other cases in progress. Good luck!