Andy’s Finance

UK Credit Card companies are to start sharing personal data in the spring that will help them weed out prudent and therefore ‘unprofitable’ customers for the first time.

Banks have been talking to industry bodies for several months about new initiative that will enable them to identify consumers who clear their balances in full every month, or who constantly switch to 0 per cent deals. Such customers make the banks no money because they do not pay punitive interest charges of up to 28%.

The disclosure follows online Credit Card company Egg’s controversial decision to cancel the cards of 166,000 customers earlier.

It claimed they were “high risk” in other words, they have missed payments or borrowed beyond their means.

However, hundreds of Egg customers came followed to say their cards had been cancelled even though they had never missed a payment, cleared their balances in full every month.

This raised speculation that Egg, owned by Citigroup, had cancelled the cards simply because it was not making money from them and this will become much easier under the new initiative.

At present, the only information banks share includes when a card was issued, when it was closed, the balance and whether or not there have been any missed or late payments.