Not upheld: interest charges and lack of clarity regarding interest calculation complaint against NewDay Ltd trading as Debenhams Credit Card

Decision detail

Summary

Mr F complained that NewDay Ltd (Debenhams Credit Card) charged him £82.95 interest in November 2025 that he did not anticipate, claiming it was not clearly communicated and appeared to be in error. The ombudsman found that Mr F had not paid his October 2025 statement balance in full and only made the minimum payment, which triggered interest charges. The October 2025 statement prominently displayed an estimated interest of £80.84, with reference to the interest rates section explaining how actual interest could differ from estimates. The actual interest charged of £82.95 was only marginally higher due to the outstanding balance increasing before payment, and was correctly calculated. The ombudsman did not uphold the complaint, finding no error had occurred and that the interest was clearly communicated.

The Ombudsman's reasoning

The ombudsman found that the estimated interest of £80.84 was prominently displayed on the October 2025 statement, and the interest rates section clearly explained that actual interest could differ from estimates if assumptions changed. Since Mr F's outstanding balance increased before his payment was made on 7 November 2025, the actual interest charged of £82.95 was correctly calculated and only marginally higher than the estimate. The chargeback had not been successfully processed at the time of the October statement, so Mr F should have reasonably anticipated interest charges. The fact that Debenhams refunded the interest as a gesture of goodwill does not indicate an error occurred, as they refunded more than was actually charged.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website