TSB to refund customers who overpaid break fees
TSB Bank will repay customers who it overcharged for terminating fixed-term lending agreements between 2008 and February 2016.
The bank identified three errors in the way it calculated the fee it charges for early termination (known as a break fee), and reported the errors to the Commerce Commission in April 2016 as a potential breach of the Credit Contracts and Consumer Finance Act (CCCFA). It overcharged some customers and undercharged others, but will not be seeking to claim money from those it undercharged.
"TSB has fully co-operated with our investigation and it says the break fee calculation errors were unintentional," commissioner Anna Rawlings said. "It will certify to the commission that the necessary customer refunds have been made."
The bank will contact customers who are entitled to a refund by the end of January 2018, and customers who were charged a break fee of less than $400 between Oct. 1, 2008 and Feb. 28, 2013, should contact TSB to see if they are entitled to a refund, the commission said