Standard Chartered: 'We goofed'

By DAILY MAIL REPORTER
Updated: 19:00 EST, 12 December 2000

The spirit of Ebenezer Scrooge is alive and kicking at one of Britain's most exclusive banks. With only a fortnight to go until Christmas, Standard Chartered has just written to every one of its 6,000 credit cardholders demanding they repay all the money they owe by the end of the year.

The letters sent out last week say: 'Credit card accounts will be closed on 31 December, 2000 and it is important that you do not use your card after that date. In addition, please destroy your card as soon as the account is closed.'

Brian Adams, 44, has held a Standard Chartered credit card for just over a year. 'I can't believe that Standard Chartered can call in their cards with such short notice. What an unwelcome Christmas present. I contacted the company and it confirmed that they want me, and all other customers, to clear the outstanding balance before the year's end.

'I inquired if they considered only 24 days a reasonable notice period and the answer I received was that the bank can request full repayment at any time. I was told I had three choices: pay in cash, transfer to another credit card or contact the local Standard Chartered branch who would be pleased to arrange a personal loan for me. I bet they would!'

Standard Chartered was set up in 1850 to lend money to people heading for the colonies. Although it has its head office in the UK, it does the vast majority of its business in Asia.

Its credit card is one of the most expensive issued. According to Money£acts, the rate on Standard Chartered's card has been stuck at 29.8% since way back in 1991. The company dropped the card from its listing late last year after the bank said it was no longer taking on new customers. Standard Chartered is pulling out of the UK credit card market after selling its personal credit business Chartered Trust earlier this year.

Even though Standard Chartered's actions seem very mean-spirited, the bank is not breaking the law. Under the terms and conditions of credit cards, companies issuing cards can call in the debts owed.

Spokesman for Standard Chartered, Tim Halford says that the bank has roughly 4m credit card customers worldwide - these are mainly based in Asia - but only 6,000 in the UK. On average, each customer owes £420 on their Standard Chartered cards - making a total debt of £2.5m to be repaid within the next three weeks.

Halford admitted: 'Our actions were totally insensitive, particularly given the time of year. We are sorry for this and regret that this has happened. We value all our customers and this is not the way to treat them. Putting it bluntly, we goofed.'

But after the intervention of Money Mail, Standard Chartered is now extending the repayment of the debts from 31 December until at least the end of February. It will send final bills out in January, for full repayment one month later. And given the extremely high rate of interest on the card, it makes sense for cardholders to get out as soon as they can - and transfer to a lower-rate card.