All Discovery Card holders ensure that you aren't incorrectly charged interest!

Hi,

I am a Discovery card holder and I always make a point to settle my credit card in full at the end of the month before the due date given on my credit card. I am also aware that there are certain transactions which immediately start drawing interest (such as withdrawing cash from your credit card, or using you credit card to pay for fuel), and I avoid these transactions completely.

I was paying my accounts today and noticed that I was charged over R600 interest on my Discovery credit card, which I thought was very weird due to all the reason above.

I was initially under the impression that I had accidentally missed a month or just paid after the deadline but I went back and verified all of my payments and invoices for the last 5 months. I didn't mess-up once.

I then remembered that there had been an issue with the Vitality cashback payments a few weeks back, and I believe that these two issues might be connected. I am under the impression that they were unable to access the FNB servers for some time and that they have now incorrectly billed interest to a large amount of their customers because of them not being able to access the servers at the required time.

I have emailed Discoverycard and asked them to follow up on this for me as I am currently overseas. Unfortunately it can take up to 3 business days for a reply...

Aw well. Will keep the post updated with any feedback from them.

Would be quite a story if they did mess up. Thousands of unhappy clients

I recall talk of problems with cashback payments, but I seem to have received mine every month.

Discoverycard service is one of the worst but their rewards are the best. Get quite a bit of money back w/o having to change shopping habits.

I received allot of money today or relatively to what I normally get anyway and I have no idea why. I couldn't make sense of the description.

Its scandalous....

I made a mistake and used the wrong months vitality cash back figures. I accidentally short-payed them R306 on a R22k bill. In other words I payed 98.6% of the total amount owing, 93.6% more than what was legally required of me to pay. I payed the 98.6% before the due date.

In response, they charged me R608.09 interest...

I would expect and accept the following: Interest on the R306 that I paid too little and interest charged from day 1 on all of the next months transactions because I lose out on the interest-free period.

However this is what they did: They charged me interest from day 1 on every single transaction for the entire month in which I made the mistake, and the following month. They completely ignored the fact that I had paid 98.6% of the outstanding amount before the due date.

Of course as luck would have it they take 3 working days to respond to any email, not just the first. I then decided to phone them instead, unfortunately all of their systems are offline today...

Every single email to Discovery takes 3 working days for a reply, even follow-up emails after the query has been logged. The replies are incomplete and they provide no direct contact detail (not even the name of the person typing the letter)!

I phoned the call centre yesterday and all of their systems were offline. I was told at first that they would not be able to call me back, but after speaking with a supervisor I was told that she would give me a call back. I did receive a call back at 6pm yesterday which said that their systems were still offline.

10:30AM today and I have not heard anything from Discovery, so I phone the call centre and their systems are back online. The person gives me the same drivel that the interest rate calculation is correct and because I have not paid the full amount: I am charged interest on the full amount (22k) and not simply on the amount outstanding (R306). I request the same document from them again that I requested via email on the 31st of March. I am told that they have requested it for me, but it could take 24hours.

Time to open up a third channel as the previous two channels have been a waste of my time:
Hello Peter - http://www.hellopeter.com/the_report.php?id=553875

I have been referred to section 8.1.3 and 8.1.4 of the Discovery Card Terms and Conditions of 2011.

8.1.3 If you do not pay the full outstanding amount on or
before the due date shown on your monthly account
statement, you will be charged interest, from the date
of each transaction on your account, on both the
statement balance and on any new purchases made
on the card (in other words, you will lose the interestfree
period on these new purchases).

Click to expand...

8.1.4 This means that if you do not pay the full outstanding
amount by the due date shown on your statement,
the interest-free period will be suspended and interest
will continue to be charged from the date of each
transaction on your account, until you have settled
the full outstanding amount you owe us.

Click to expand...

Hence if you receive a statement for R10,000.01 and you only pay R10,000 you will be charged interest on R10,000.01 and not on the 1c that you did not pay!!! I fail to believe that those two clauses would be legal in South African law, and it would appear that I will soon be approaching the banking ombudsman and thereafter the NCR if necessary.

As per the NCA: The maximum prescribed rate permitted in terms of the National Credit Act is calculated yearly by taking the ruling of the South African Reserve Bank Repurchase Rate times 2.2 and adding the following percentage in relation to the transaction that one is faced with:

unsecured credit transactions repo + 20%

The repo rate currently stands at 5.5%, hence the maximum allowed interest on unsecured credit transactions is 25.5% per annum. DiscoveryCard charged me 198% in a single month! Worst case any interest should be lower than 5.5 * 2.2 + 20 = 32.1%

After my HelloPeter complaint Discovery assigned a customer relationship manager to my case and Discovery have agreed to reverse the interest. It appears that the best way (only way?) to get proper service from Discovery is to complain on HelloPeter.

That is just ridiculous. How can they charge you for the full amount? I feel like cancelling my card now.

Jeez dude thats insane! Glad I never took out a discovery card when I was offered one!

It's actually pathetic how customers have to go to such lengths to get an issue sorted out. Customer service is really lacking in allot of these bigger companies.

Wyzak said:

I have been referred to section 8.1.3 and 8.1.4 of the Discovery Card Terms and Conditions of 2011.





Hence if you receive a statement for R10,000.01 and you only pay R10,000 you will be charged interest on R10,000.01 and not on the 1c that you did not pay!!! I fail to believe that those two clauses would be legal in South African law, and it would appear that I will soon be approaching the banking ombudsman and thereafter the NCR if necessary.

Click to expand...

those terms and conditions sound ok, it seems like you are misunderstanding. i think it means if you owe 10000.01 and pay 10000 then you will pay interest on 0.01+ whatever you spend until your next statement period, hence the charge "on both the statement balance (which is the unsettled amount) and on any new purchases made on the card" or is my understanding completely off here?

glad they refunded you because they should be on the same fnb system so they should charge the same amounts in the same manner as the fnb cards... my card is arriving on monday, hope i dont experience such problems...