Halifax to Use Debt Collectors for Credit Card Debt

Credit card customers of Halifax have been warned that they could end up being chased by debt collectors.

With the Scottish bank due to end its retail operations from June 18th, it has decided that it wants its 50,000 credit card customers to close their credit card accounts by then, either by transferring to another card provider or by clearing the balance, or face the prospect of being chased by debt collectors.

Halifax has said that it would offer those who were unable to clear their balance, or find a suitable transfer to another provider, the option of converting their card balance into a personal loan but Emmet Pullan of Debt Plan Ireland clams he has been told by the bank that this is not the case and personal loans will not be offered, instead the debt will be sold on to a debt collection agency.

Mr Pullan said “We would feel that customers should be aware of this situation as this proposed action may further impact their credit rating. Some debt collection agencies will have vigorous recovery techniques so customers should prepare to engage them with a repayment plan should the account transfer.”

A spokesman for Halifax/Bank of Scotland said no decision had been made yet on what will happen to those card customers who are in arrears when branches start to close in June. He also confirmed that anyone who fails to make payments on their card for six months in a row is being classed as “in arrears” and they may well find that their debt has been sold on to a debt collection agency if they do not contact the bank.

The Halifax spokesman stressed that customers should try to clear their credit balances by June 18 by switching or paying off the balance.