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Wellington, December 14, 2017
TSB Bank Limited (TSB) will repay customers who were inadvertently overcharged for terminating their fixed-term lending agreements.
TSB identified three errors in the way it calculated the fee it charges for early termination (known as a break fee).
These errors led to some customers being overcharged and some being undercharged. TSB reported the errors to the Commission in April 2016 as a potential breach of the Credit Contracts and Consumer Finance Act.
Nine-Year calculation
TSB will be recalculating the break fees and refunding customers that were affected from 2008 to February 2016. It will not be seeking to claim money from those it undercharged.
Commerce Commission Chief Anna Rawlings said that she was pleased that TSB had reported itself to the Commission once the issue was identified.
“TSB is paying refunds to affected customers and is writing to customers who are entitled to a refund. It is also using its website to alert customers that it had inadvertently overcharged break fees on some affected loans. TSB has fully cooperated with our investigation and said that the break fee calculation errors were unintentional. It will certify to the Commission that the necessary customer refunds have been made,” she said.
Customer Contact
TSB will contact customers who are entitled to a refund.
Any customer who thinks that they are entitled to a refund and who has not heard from TSB by the end of January 2018, should contact TSB.
Customers who were charged a break-fee of less than $400 between October 1, 2008 and February 28, 2013 should contact TSB to see if they are entitled to a refund.
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