What can a bank do when you fall behind on your card?

Central Bank standards set out how a bank, and any agency it hires, may chase you over arrears. Contact must be proportionate and not excessive, and the bank must follow a fair process before going to court.¹

How may a bank contact you about arrears?

By email, registered mail, courier, SMS, phone, or another method you agree to.¹ The bank must not:¹

• visit your home or workplace unless you give expressed consent or a court orders it
• visit you outside 9am to 8pm
• phone you outside 9am to 8pm, or make an unreasonable or excessive number of calls
• tell anyone about your debt except the credit bureau, an authorised debt collection agent, someone you consent to, or where the law requires

Every call or message about your debt must give the bank’s name and its collections department or agent, a contact number, the department’s working hours and the name of the person calling. If you miss a call, they should leave a message so you can call back on the same number.¹

What must the bank send you in writing?

The notices are set out in the standards.¹ If the bank passes your account to a collection agency, it must tell you who the agency is, the amount it will collect and its authority, including whether it can take payments.¹

Does the bank have to help you pay?

It must offer qualified credit counselling, consider alternative arrangements when you approach it, and contact you when it first sees payment problems.¹ If you agree a revised plan, the bank must confirm it in writing within 10 business days with a new payment schedule. If it rejects your offer, it must tell you why in writing.¹ Each bank must also run a debt management section on its website, linked from the homepage, with contacts for its arrears staff and the fees charged on arrears.¹

Collection can cost you money. HSBC’s tariff says it charges a collection agency fee to your card account when it appoints an external agency.²

What if a collector breaks the rules?

Keep a record of each call: date, time, number and name. Complain in writing to the bank, then to Sanadak if the bank does not resolve it. The bank must record every communication about arrears and keep the records for 5 years after the debt is settled or written off.¹ See how to complain.

The small print

• Collection rules are Consumer Protection Standards section 5.2.5: discussion before collection 5.2.5.1, arrears contact 5.2.5.2 to 5.2.5.5, communication rules 5.2.5.6, records 5.2.5.7, third-party collectors 5.2.5.8.¹
• Financially distressed consumers are section 5.2.4. Missed payment letters are clauses 2.1.3.22 and 2.1.3.23.¹