Long term credit card debt

The Minimum Payment Plus is a monthly amount that we encourage you to pay if you can afford to as it can help you avoid holding long term debt and save you money compared to only making the contractual minimum payment. It will cover at least double the interest, fees and charges shown on your statement and will change each month in line with spending and repayments. The amount includes your contractual minimum payment.

The contractual minimum payment (shown on page 1 of your statement) is the lowest amount you must pay in order to keep your credit card payments up to date. In order to ensure the balance on your credit card is reducing and to avoid long term debt on your card, it would be helpful for you to pay more than the minimum payment each month.  There is no obligation to pay the Minimum Payment Plus amount.  It’s voluntary, but if you can afford to we encourage you to pay at least the Minimum Payment Plus each month.

If you’ve been repaying at least double your interest, fees and charges recently then you may find that your monthly Minimum Payment Plus amount is similar to your minimum payment.

The Minimum Payment Plus will always be at least your contractual minimum* payment and include any Instalment Plan amount and fee – but it will usually be more, as it’s designed to pay off over time at least double the amount you’re being charged in interest, fees and charges plus £1. For example, a customer who has a balance of £3,000 with an interest rate of 18.9%, would have £43 of interest applied.  This means their minimum* would be £73, and the Minimum Payment Plus would be at least £87. Please refer to your most recent statement message or the mobile app for your Minimum Payment Plus amount.

Depending on how long you’ve been holding long term debt on your card, the Minimum Payment Plus amount may be considerably more. Please refer to your most recent statement message or the mobile app for your Minimum Payment Plus amount.

*The minimum payment is usually 1% of the credit card balance, plus interest and fees and charges, (however this may differ depending on the credit card product you hold). 

The Minimum Payment Plus will change each month dependent on the credit card balance.

To keep your credit card repayments up to date you only need to pay the minimum payment. The Minimum Payment Plus is an amount that’s been calculated as a guide to avoid holding debt for a long time on your credit card, to help you repay your balance quicker than if you were paying the minimum.

If you continue to pay only the minimum you may notice the Minimum Payment Plus amount increasing each month. This is because it’s calculated to help you avoid or move out of long term debt over time and the amount is adjusted each month based on your previous repayments.

For example, a customer who has a balance of £3,000 with an interest rate of 18.9%, would have £43 of interest applied. This means their minimum* would be £73, and the Minimum Payment Plus would be at least £87. The Minimum Payment Plus amount asked for an extra £14 on top of the contractual minimum. If this voluntary extra wasn’t paid, the £14 would be carried forward and included in requested payments in future months.

Depending on how long you’ve been holding long term debt on your card, the Minimum Payment Plus amount may be considerably more.

Additionally, if you only make the minimum payment there is a greater chance that if you are in persistent debt you will remain there. If this is the case for an extended period of time then we will get in touch with repayment options to help you repay your debt.

If you’ve been paying the minimum for a while, you might find that we still write to you to let you know you’re in Persistent Debt, even after you’ve increased your repayments. This is because of the voluntary extra amounts we carry forward from previous months where the repayment has been less than the Minimum Payment Plus.

Any voluntary extra accumulated is included in your Minimum Payment Plus amount but spread over several months*. Therefore if you’ve recently switched to paying the Minimum Payment Plus you may still receive a letter from us, but if you keep on paying the amount, you’ll find that you won’t receive any further letters about it as you’ll no longer be holding long term debt on your card.

*the size and proportion of the extra amount included depends on how long you’ve been holding long term debt on your card. If you’ve been holding long term debt on your card for a while the Minimum Payment Plus amount may be considerably more than the minimum.

There are a number of reasons why a Direct Debit may be returned unpaid. The most common of these is when there are insufficient funds available for the Direct Debit to claim. Please check that there are sufficient funds available in your account for this amount to be claimed in order to avoid any late payment or returned payment fees being charged.

Unpaid Direct Debits may cause your account to fall into arrears / excess so it's important, where required to make an alternate payment. You can log in online or check your mobile app to confirm the amount required to pay to bring your account up to date.

If you find you can no longer afford to pay the Minimum Payment Plus amount each month, you can amend or cancel your Direct Debit amount through our Mobile App, or contact us for help if you only need to amend or cancel the Direct Debit for one month. You will always still need to pay at least your minimum payment to keep you account repayments up to date. 

The Minimum Payment Plus repays an amount equivalent to at least double any fees and interest. Therefore, if you incur a balance transfer fee, please bear in mind this fee is incorporated in to the Minimum Payment Plus calculation. As an example, if you have a Balance Transfer fee for £150 charged on your previous statement, your Minimum Payment Plus will be at least £300 for that month. 

Our Minimum Payment Plus Direct Debit can be used to collect the voluntary payment which you can set up through our Mobile App or Digital Banking or over the phone.  It’s important to make sure you can afford to increase your payments, especially as the amount can vary from month to month.  Please check your statement for the latest Minimum Payment Plus repayment amount.

If you don’t pay through Direct Debit, you can still pay the Minimum Payment Plus amount shown on your statement each month if you have a current account with us;

Via the mobile app,

In Digital Banking, or

Over the phone