Vanquis ROP Interest Refunds – FAQs

 

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Vanquis ROP – Interest Refund FAQs


About the Repayment Option Plan (“ROP”)

What is the Repayment Option Plan?

The Repayment Option Plan is an optional part of Vanquis' customers' credit card account. The Plan currently has 3 features, designed to help you build or rebuild your credit profile. The features are:

  • Account Freeze,
  • Lifeline,
  • Payment Holiday,

Further details about the Plan are available here.

Is ROP the same as Payment Protection Insurance (PPI)?

No ROP and PPI are not the same. PPI was an insurance product which would cover certain repayments or even repay the whole debt in certain circumstances where you couldn’t make payments yourself. These usually included if you were made redundant or couldn’t work due to an accident, illness, disability or death. Vanquis did not sell PPI with its credit cards.

 

ROP is different. It allows you to miss payments or for payments not to be required in certain circumstances but it does not make payments on your behalf or repay the outstanding balance. ROP is not an insurance product and is not treated as such by the FCA.

 

As a reminder, ROP offers you the ability to freeze your account in the event of certain difficult financial circumstances, take a payment holiday and have a lifeline if a payment is missed. Further details about the Plan are available here.

How much does it cost?

There are two plans:

 

The Standard Plan which is for people who are homemakers, students, retired or not in employment. The Plan currently costs £1.09 for every £100 of your outstanding statement balance each month.

 

The Full Plan which is for people in full, part-time or temporary employment or self-employment. The Plan currently costs £1.19 for every £100 of your outstanding statement balance each month.

 

The Plan is charged as a purchase transaction on your Vanquis card and therefore incurs interest at the purchase interest rate if your balance is not paid off in full each month.

If I still have ROP, am I still paying interest on the Plan?

Yes. The refund of interest is from the date on which you first incurred interest relating to the Plan to 30 days after we sent a letter explaining the details of the Plan and its cost to you. If you are still opted into the Plan and do not pay your credit balance in full each month, then the accrued charges will be subject to interest in the same way and at the same rate as other purchase transactions you make on your card.

If I have ROP, does this refund mean I can no longer use the product should I need to?

No, if you have ROP on your account, you can continue to use the features in line with the card’s Terms and Conditions. Details of ROP and its features can be found here.


About the ROP Interest Refund

Why have I received a refund of interest incurred on ROP?

We agreed with the FCA’s conclusion that we did not, during the call where you opted-in to the product, tell you that charges for the Plan attracted interest at your purchase interest rate (though this was disclosed in writing before and after the call). As such, we agreed with the FCA (using its statutory powers) that customers entitled to a refund would be repaid interest charged relating to ROP.

Was ROP mis-sold?

We agreed with the FCA that we did not, during the call where you opted-in to the ROP, tell you that charges for the ROP attracted interest at your purchase interest rate. As such, we were required by the FCA under their statutory powers to refund eligible customers who were charged interest on ROP from 1 April 2014. In addition, we voluntarily refunded eligible customers who were charged interest on ROP from June 2003 until 31 March 2014.

 

The FCA's findings were in relation to the disclosure of interest of ROP charges and not the ROP product itself. As such, the refund did not include a refund of the ROP product. Any ROP mis-sale claims are separate and reviewed on a case by case basis by our Customer Relations team.

Have you put me back into the position I would have been had the ROP interest never been charged?

No. As set out in the Final Notice, we agreed with the FCA that we did not, during the call where you opted-in to the ROP, tell you that charges for the ROP attracted interest at your purchase interest rate, although, this was disclosed in writing before and after the call.

 

In light of this, we have refunded the interest you were charged on ROP balances but we were not required to reconstruct your account as if ROP interest had never been applied.

 

This calculation methodology was agreed with the FCA and was audited by an independent company to ensure it was accurate.

Why am I still waiting to get my ROP interest refund?

We were required by the FCA to refund eligible customers before the end of February 2019. We have completed the programme but if you believe you are entitled to a refund and have not yet received this, please contact us on 0330 099 3105.

I’ve lost my cheque. What should I do?

If you have lost your cheque then please contact us to organise a replacement:

Will this refund have any impact on my relationship with you as a lender?

No, it won’t have an impact. We will continue to be your credit card provider and support you in improving your credit profile.


About the ROP Interest Refund amount

What was the ROP interest refund amount comprised of and how was it calculated?

ROP is charged monthly per £100 of the outstanding balance. In line with your credit agreement, ROP is applied to your account as a purchase transaction and interest is incurred on this charge at the purchase interest rate. However, if you pay your balance in full, you will not incur interest.

 

We agreed with the Financial Conduct Authority’s conclusion that we did not, during the call where you opted-in to the ROP, adequately inform you that charges for the Plan attracted interest at your purchase interest rate. We have therefore refunded the interest incurred on the ROP charge but not the ROP charge itself. These charges were clearly explained when the Repayment Option Plan was sold and in the accompanying paperwork.

 

Your ROP interest refund was comprised of two components:

  1. Compound interest charged on Repayment Option Plan charges – This is the proportion of your interest charges that related to the Repayment Option Plan.
  2. Compensatory interest – This is due when your account would have been in credit had we not charged you interest on the Repayment Option Plan.

There were many factors that influenced the refund amount which made the calculation complex, for example, if you have ever:

  • Paid more than your statement balance
  • Been charged late or over limit fees (as interest is applied differently on these transactions)
  • Returned a purchase for a refund or had a purchase reversed for any other reason
  • Had payments reversed, for example as a result of insufficient funds or through the Direct Debit Guarantee

Although these were some of the most common situations, we haven’t listed them all here, but we did take them all into account in calculating everyone’s refund to ensure that you weren’t disadvantaged as a result.

 

The underlying methodology for the refund calculation was agreed with the Financial Conduct Authority. It was really important to us that we refunded you the right amount, so we asked an independent company to validate the calculation before we issued refunds to our customers.

 

If you have any questions on the calculation of the refund or you would like a more detailed breakdown then please contact us:

  1. By calling 0330 099 3105
  2. By emailing ROPRefundsTeam@email.vanquisbank.co.uk
  3. By writing to Repayment Option Plan Team, PO Box 399, Chatham, ME4 4WQ

When was my refund paid until?

We refunded interest on ROP charges because we agreed with the FCA that we did not tell you, on the call when you opted-in to ROP, that you would be charged that interest.

 

In 2016, we separately agreed with the FCA to send customers a written reminder of the costs and features of ROP, including the way that interest was applied. Customers who had ROP on or after 19 April 2016 were sent a written communication between October 2016 and February 2017.

 

The FCA was satisfied that, for customers who held ROP at the time, the written reminder adequately informed customers that ROP charges attracted interest at the purchase interest rate. As a result, we agreed with the FCA that the ROP interest refund is paid up to 30 days after each customer received their written reminder.

 

Since September 2017, we have sent an annual written reminder to customers explaining the costs of ROP in the previous year and the projected cost for the year ahead if they were to maintain the same balance. These communications are made either by letter, email or are sent with statements.

 

Customers who did not receive a written reminder, for example because they cancelled ROP or closed their account before 19 April 2016, have received a refund of interest on ROP charges up until the refund was paid.

 

In addition, where a customer’s account would have been in credit had the ROP interest not been charged, compensatory interest at 8% has been paid on the amount by which the account would have been in credit. This is to compensate for the loss of access to those funds and will be paid up until the date of the refund, irrespective of whether a written reminder communication was sent.

Was I eligible for compensatory interest?

If your account would have been in credit had the interest on ROP not been charged, we automatically added 8% compensatory interest to your refund amount. For periods where your account would not have been in credit, compensatory interest is not payable.

 

Our assessment of any compensatory interest was in accordance with the Financial Ombudsman Service and Financial Conduct Authority’s guidance. This was calculated on a simple interest basis at 8%. Where applicable, compensatory interest continued to be added until payment of the refund was made so you did not lose out as a result of any delay.

 

In line with HM Revenue & Customs (HMRC) guidelines, we were required to deduct income tax from the notional interest at the basic rate of 20%.

Why haven’t you refunded over limit fees?

We agreed with the FCA that these fees would not be refunded. We assess your account each month when we produce your statement and if you are over your agreed credit limit by more than a certain amount; you may be charged a fee. This assessment is carried out before any ROP is charged. The interest charged on ROP typically makes up a small element of the overall purchase interest charged in any given month.


Need further support?

I think I’m in Financial Difficulty, what can I do?

Please call us to discuss your current situation, as we may be able to help. You may also benefit from contacting one of the below agencies who offer free and impartial debt advice.

   

Money Advice Service: 0300 500 5000

   

National Debtline: 0808 808 4000

   

StepChange Debt Charity: 0800 107 9613

What should I do if I want further detail about how my ROP interest refund was calculated?

If you have any questions on the interest refund calculation then our Customer Services team would be more than happy to discuss this with you. Please contact us:

I have another question which hasn't been answered in the above or in the letter from Vanquis

If you have any concerns or issues about the refund or the Plan, please contact us: