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No credit card cheque law needed, says Apacs

Fri, 03 Mar 2006

The UK payments association Apacs has stated that there is no need for legislation with regards to credit card cheques.

This announcement comes after the Office of Fair Trading (OFT) has called for such rules to be imposed by the government in order to protect consumers.

It has been claimed by the OFT that credit card cheques fail to offer enough transparency to those who might use them.

Credit card cheque payments often come with a higher interest rate than credit cards, while no interest free period applies, according to the OFT.

However, Apacs says the banking code already covers the majority of the recommendations made by the consumer watchdog.

Mark Bowerman, a spokesperson for the payments association, says credit card cheques are circulated with terms and conditions.

"The only thing that isn't in there is the opt-in," he notes.

This refers to the OFT's argument that only people who have specifically requested a credit card cheque should be sent one.

Mr Bowerman continues: "You may receive them without asking for them." However, he points out that "there is an opt-out" and that consumers could request not to be sent credit card cheques.

"Opt-in versus opt-out will be discussed at the review of the banking code," he concludes.

The new banking code would come into effect in 2008.

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