Select Committee on Treasury Minutes of Evidence


Examination of Witnesses (Questions 298-299)

MR JOHN VARLEY, SIR FRED GOODWIN, MR SHANE FLYNN AND MR MICHAEL GEOGHEGAN

26 OCTOBER 2004

  Q298 Chairman: Good morning gentlemen. Welcome to this, our second session on the transparency of credit cards. Can I ask you to introduce yourselves for the record?

Mr Geoghegan: Michael Geoghegan from HSBC.

  Mr Varley: John Varley from Barclays.

  Sir Fred Goodwin: Fred Goodwin, the Royal Bank of Scotland.

  Mr Flynn: Good morning, Shane Flynn, MBNA Europe.

  Q299 Chairman: Welcome, you know some of your colleagues in industry were in last week. I am sure you have seen the video and you know the type of questions, so this must be an easy session for you. It is over a year since the Committee started its inquiry into the transparency of credit cards and, as you know, we feel there has been quite a lot of progress undertaken in that past year by yourselves. We are aware also there is quite a way to go yet in this issue of transparency and competitiveness and we would like your views this morning on where you think your companies are at, where you have acceded to the APACS recommendations and where we can go on this so that we can close this off. The Committee will be looking at this issue and coming out with a short report, hopefully in advance of the Consumer Credit Act going through Parliament so that can inform Parliament and inform the industry. Can I start with you then and ask where you have gone beyond the minimum requirements negotiated by APACS and what progress you have made in the year, Mr Varley from Barclays Bank?

  Mr Varley: Thank you Chairman. I hope you know that Barclays and Barclaycard have taken the Committee's inquiry and the issues that it has raised very seriously. Over the last year we have worked hard to improve transparency for consumers. We support fully all the industry wide agreements that have been reached and we have either already implemented them or are in the throes of doing so and in a number of areas, to your point, we have gone further. We re-designed all our marketing material to make it clearer and more transparent, we have rewritten our terms and conditions and we have increased print sizes wherever possible. From September 2004, scenarios describing the costs and time frames of making minimum repayments only started appearing on our marketing material. We have included a generic summary box on Barclaycard monthly statements, and we will follow suit in Monument in the early New Year. To help customers more easily understand their personal cost of using a Barclaycard we have launched an online calculator. This month our Barclaycard branded statements will include minimum payment warnings on the summary box and the same statement will appear on all our marketing material in November. Also in November, we will be adding the industry agreed interest calculation row to our summary boxes. This is designed to help customers understand more easily the interest calculation method we use. Barclaycard is committed to improving transparency where we can. We will consider carefully, of course, any suggestion that benefits consumers and, in particular, we would like to work with the industry and Government to improve the current situation with regard to credit data sharing.


 
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