UK neobank Virgin Money has decided that suspending nearly 32,000 credit cards amidst an international crisis might not be such a good idea after all.
Thousands of customers were shocked last week when Virgin Money sent them an email saying that their accounts had been blocked with immediate effect.
Then, having thought about if for a few days, Virgin Money reversed its decision.
“Having made changes to a number of credit card accounts to reduce the chances of customers getting into unsustainable debt, we recognise that it was not the right time to make these changes,” Fergus Murphy, the group personal banking director at Virgin Money, told The Guardian.
“We listened and we’ve now reversed the decision. We are sorry for the additional worry and inconvenience this may have caused, particularly at this time.”
Virgin Money said that affected customers will now be able to make purchases again using their credit cards, with previous credit limits reinstated.
The news comes after the Financial Conduct Authority (FCA) introduced a number of relief measures to protect people affected by the coronavirus. That package of temporary measures was designed to help people with some of the most commonly used consumer credit products.
For instance, businesses are now expected to offer a temporary payment freeze on loans and credit cards for up to three months for consumers negatively impacted by the coronavirus.
Additionally, the FCA told credit firms that also expected to allow customers who already have an arranged overdraft on their main personal current account up to £500 charged at zero interest for three months and to ensure that all overdraft customers are no worse off on price when compared to the prices they were charged before the recent overdraft pricing changes came into force.
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