Minimum monthly payments

From 29th April 2011, we are changing the way we calculate minimum payments for our customers and we wanted to take this opportunity to explain how this will work.

What this guide covers

Minimum Payment changes – what does it mean?
Do I need to amend my standing order or Direct Debit?
How can we support you
Working with customers in financial difficulty
Some sources of help and advice

Minimum Payment changes – what does it mean?

We are changing the way we calculate minimum payments on our accounts. We are replacing part of the calculation with a new element which works out 1% of your borrowing, plus the range of other factors that make up your monthly credit card bill (for example, interest, annual fees (if applicable) and late, overlimit or other default charges) when calculating how much you need to pay.

All new MBNA accounts opened since mid-2009 already use a similar calculation.

Do I need to amend my standing order or Direct Debit?

Standing Order

If the fixed amount you are currently paying is less than the new payment appearing on your May statement then you will need to either increase the fixed amount or pay the difference separately. Please remember to do this in good time before your due date. To change your standing order, please contact your bank to make the necessary amendments and make sure you will have sufficient funds to cover the new standing order amount.

Direct Debit

For fixed Direct Debits, if the fixed amount you are currently paying is less than the new payment appearing on your May statement then you will need to either increase the fixed amount or pay the difference separately. Please remember to do this in good time before your due date. To change the Direct Debit, please contact us on 0818 409 511 to request the necessary amendments. We have developed an online calculator to help you understand the potential difference between your existing and new minimum payments. You will need your most recent statement to hand.

If you have a Direct Debit set to cover your minimum payment, you do not need to amend your details as the minimum payment will automatically be calculated and collected. You should check your May statement to understand how the change impacts you and make sure you will have sufficient funds to cover the new Direct Debit amount.

How can we support you...

We appreciate this may be a significant change for some customers and that is why we are giving as much support as we can to help you understand what these changes could mean to you. We have developed an online calculator to help you understand the potential difference between your existing and new minimum payments.

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This calculator is designed to provide an approximate illustration of the difference between MBNA’s current and new minimum payment calculations and relies on the details entered from your statement as a starting point. This calculator assumes that you only pay the minimum payment each month, that your account is not in arrears or overlimit and that you are not on a reduced payment plan. Please refer to your monthly statements for confirmation of the actual amounts due on your account and please remember that if your balance increases, the amount you have to pay may also go up.

If default charges appear on your statement, please include the amount of all default charges as requested above. The calculator will then display your minimum payment, to which you should add the amount of any arrears and overlimit, as these are payable immediately and will form part of the amount requested in your monthly statement.

If you pay an annual fee on your account we will also add the amount of the fee to your account in the month it is payable. For an approximate indication of how your minimum payment may be affected by this, you should add the amount of the annual fee to the results displayed by the calculator. Please refer to your Terms and Conditions which give details of any annual fee applicable to your account.

For further information please refer to Frequently Asked Questions

Working with customers in financial difficulty

If you find yourself in financial difficulties or if you are concerned that you will struggle to make your new monthly payment, you may want to discuss it with us. If you are experiencing financial difficulties we will work with you to minimise any impact of this change.

You can call us on 0818 409 511 to discuss your financial situation. If you are experiencing financial difficulties we will need you to complete an income and expenditure form to demonstrate how much you can afford to pay. Once you have done this we may be able to assist you by offering you a reduced payment plan or accepting what you are able to afford and reducing or freezing interest and charges.

If you have an existing payment plan with us, you should continue to make your usual payments. The minimum payment changes would only take effect once the plan has come to an end.

If you are not on a payment plan but are in arrears, the new minimum payment calculation will be effective after your account is back up to date.

You can find information about free help and advice below.

Income and Expenditure details

If you do have concerns, you can print, complete and return our Income and Expenditure form to:

MBNA EBL Customer Assistance,
MBNA, Dublin Road,
Carrick on Shannon,
Co. Leitrim

Or call us with the details of your incomings and outgoings on 0818 409 511 to the options available to you

Once we have received your Income and Expenditure form we will take the most appropriate action for your circumstances. If that means taking steps such as putting your account on a reduced payment plan, that information could be visible on your credit file and viewed by other creditors, which may, in turn, affect your ability to obtain future credit. If you would like to discuss how this may affect you, please contact us on 0818 409 511 before you send your Income and Expenditure details.

Some sources of help and advice

Impartial websites such as It’s Your Money or the Money Advice and Budgeting Service(MABS) offer valuable information and advice on saving money and tackling debt .

Money Advice and Budgeting Service
www.mabs.ie
Lo Call: 1890 283 438

Financial Regulator
www.itsyourmoney.ie
Lo Call: 1890 777 777

Please note: The contents of these pages are not intended to be taken as financial advice or recommendation made by MBNA. You should seek independent financial advice if you are unsure about your financial needs.