Financial Services > Credit Cards > Reclaim Credit Cards Charges > Why card charges are unlawful

Why Credit Card Charges are Unlawful

According to consumer law, any charges credit card providers levy on their customers for breach of contract must be relative to the actual administrative costs they incur.

However, over the years these companies have been getting away with fining their customers extortionate amounts whenever a credit card repayment date has been missed or a customer has gone over their credit limit.

It is estimated that these unlawful charges generate around £300 million a year for Britain ’s credit card providers.

Fortunately, an investigation by the Office of Fair Trading in 2006 supported consumers’ cases for reclaiming credit card charges after it concluded that fees above £12 were unfair and unreasonable and ruled it would investigate any credit card providers that charged a penalty fee in excess of this recommended amount.

As a result, most of the major credit card providers decided to slash their charges from an average of £30 to £12, where they have remained since June 2006, although some ignored this and continued charging over the limit.

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