Virgin Money customers who had their credit card suspended will be able to use them again from tomorrow after bank’s U-turn
- Customers will be able to use their credit cards again from Saturday 9 May
- Their previous credit limits will also be reinstated, Virgin Money said
- The bank has apologised as the suspension attracted strong criticism
Virgin Money customers who had their credit cards suspended will be able to use them again from tomorrow after the bank U-turned on its decision to stop them from making purchases on their cards.
Around 32,000 customers, around 1.6 per cent of Virgin Money’s customers, had their credit cards blocked earlier this week, despite many of them not struggling with their repayments and clearing their balances in full.
But today Virgin Money apologised and reversed its decision, saying that everyone who had their card suspended will be able to use them to make purchases again from Saturday 9 May. It also said that credit limits will be reinstated.
U-turn: Customers of Virgin Money will be able to use their credit cards again from Saturday
‘Having made changes to a number of credit card accounts to reduce the chances of customers getting into unsustainable debt, we recognise that it was not the right time to make these changes,’ said Fergus Murphy, group personal banking director at Virgin Money.
‘We listened and we’ve now reversed the decision. We are sorry for the additional worry and inconvenience this may have caused, particularly at this time.’
The U-turn comes as the bank’s decision attracted strong criticism, with the Financial Conduct Authority telling This is Money earlier this week that it was discussing the situation with Virgin Money ‘to understand how they are supporting the customers concerned.’
One expert said Virgin’s decision seemed ‘to go against everything the FCA is trying to do to help consumers during these challenging times.’
Two longstanding customers of the bank complained to This is Money that they had either paid their balance off in full every month or paid substantially more than the minimum payment each month.
One even said her finances were in the best position they’d been in in the two years she had been a cardholder.
A statement released by Virgin Money today says: ‘Following a recent review of credit card accounts, Virgin Money contacted a number of its credit card customers this week to let them know that they would not be able to use their credit card to make new purchases.
‘These changes were made as a responsible lender to reduce the chances of financial difficulty for customers in the future.’
Some borrowers had speculated the accounts were blocked due to the bank being worried about people being unable to repay their debts in the midst of the coronavirus pandemic, with it announcing on Thursday it was setting aside an extra £164million to cover virus-related defaults.