When stores charge payment reminder fees | #daitngscams | #lovescams

Wendy Knowler follows up after a clothing store client takes issue with being charged for reminders on various platforms, mounting up to over R40 for the month.

Bruce Whitfield chats to consumer ninja Wendy Knowler on The Money Show (skip to 53:40 to listen).

Some companies charge their account holders a fee if they have to be contacted with a reminder to cough up at least the minimum payment due PAST the cut-off date.

Is this practice acceptable, and is it legal?

@ antonioguillem/123rf.com

Consumer journalist Wendy Knowler follows up on a complaint from a customer who has an account with men’s clothing retailer Markham (part of the TFG group).

According to Themba, the company charges R20 for a call, R20 for a collection letter and R2.80 for an SMS to remind consumers to pay their overdue accounts.

What he takes issue with particularly is that it seems all three platforms can be used, resulting for him in a minimum “extra” charge of R42.80.

Themba also relates that after writing to TFG more than a month ago, he has yet to receive a response.

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Right off the bat says Knowler, it’s a mistake to ignore a client.

“Companies, if you just handled your correspondence internally as customers expect, these things wouldn’t spill over to the public arena.”

The consumer ninja followed up with TFG and found out that 8% of their client book currently either short pay or don’t pay by the due date.

TFG’s latest annual reports reveals that as at March this year, they had almost 2,8 million active account holders. So they’re adding payment reminder fees to about 224 000 accounts every month, if my maths is correct. That’s quite a lot!

Wendy Knowler, Consumer journalist

The company also noted that it’s been collecting these payment reminder fees since the inception of the National Credit Act in 2008, in line with the legislation.

Woolworths also employs this practice Knowler says, but it’s not specified in the Ts and Cs.

As far as she can tell by sleuthing on the Internet, Truworths does not.

In the case of the TFG protocol, client costs would certainly mount up while the arrears persist but they should be aware of this, she adds.

It’s going to add up to quite a lot and you can see why people who get a late get a bit cross… but as you say, you sign this contract and you agree to pay the minimum amount by the due date and if you don’t this is what happens.

Wendy Knowler, Consumer journalist

Check your own store contract(s), she advises.

Better still, Knowler says, work on closing your store accounts as interest is high and then these contract fees also add up.

Better off using credit cards only – you can’t spread your credit and go into denial, and you won’t feel part of a “club” in one of those, which increases your chances of doing retail therapy.

Wendy Knowler, Consumer journalist

Listen to the interview audio at the top of the article to get more detail (skip to 53:40)

This article first appeared on CapeTalk : When stores charge payment reminder fees – are they justified?

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