Image Courtesy:Morgue File
I thought of closing all my credit cards(HDFC, Barclays) in November 2008, so I approached the respective customer care to get an idea about the process.
On inquiry, they informed me that once the "full and final" payment has been made, the card closure letter would be sent to my address within three days. Trusting their words, I did what I thought was a full and final payment and expected a card-closure letter but that never arrived.
A month later, I was shocked to see a statement which still had some outstanding.
Instantly, I called up the customer care and as always, they had a system downtime. So, I wrote an e-mail to the support group. I got no reply even after 5 days, so after an extensive search on the internet, I managed to get the e-mail address of the support head. It took me more than a month to receive a reply from them.
My point was very clear. When I ask for a final settlement, it means that I will no longer be using the card. So, intrinsically it means that I am asking for full settlement. However, to maintain their customer strength, these companies never close your account even after the full and final payment and will not include your current month outstanding.
Taking forward this point, I had a heated verbal arguement with the customer care. At the end, I realized that this was of no value to them. To my claims of having been told by the collection department that this was the final settlement, they would retort by saying "Who told you?", "Which customer care?", "We aren't aware. You have to pay the amount and we will send you the letter" and so on.
I wasn't ready to pay this amount at all but I was unlucky. I had linked my card to my savings account and by virtue of a "stupid" law that gives Credit card companies the authority to hold back funds from a linked account, I was forcibly made to pay. They send you a letter stating that "as per the law, funds have been held and you need to contact them and sign a letter of authority for release of funds". Even if you don't, within 7 days, they take the money from your account.
Yes, I did falter, but there were lessons learnt.
a) First, do not make a final settlement without a card closure letter. If you have approached them for a final settlement, ensure you tell them to bring your closure letter when they are coming to receive the payment.
b) Second, do not ever link your credit card with your savings account. Once the funds are held, you have lost your battle.
Last but not the least, avoid using Credit Cards as much as possible. Remember, you have to pay back with "alarming" interests and if you are unlucky like me, you need to pay undeserved bonuses to these companies.
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