Card refunds withheld

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Card refunds withheld

Fifteen card companies failed to return annual fees to customers who canceled their memberships in the first subscription year even though they were advised to reimburse them, the Financial Supervisory Service said yesterday.

Based on an inspection in late June involving 20 card companies, only five had repaid annual membership fees to customers who canceled their cards during the first year.

“Of the 15 card companies that had not provided reimbursements, 10 were found to have not even notified their customers that they were able to get back their membership fees in the event of membership cancellation,” said an official from the FSS. “Also, they were only returning annual fees only to those subscribers who requested reimbursement.”

The official said the remaining five card companies among the 15 paid back customers their annual subscription fees only upon request through their call centers.

According to the regulator, from April 1 to June 30 there were 148,897 cases in which card companies didn’t provide reimbursements to customers who canceled their memberships, which amounts to nearly 1.4 billion won ($1.25 million) in unreturned fees.

In April, the FSS advised plastic card companies to voluntarily pay back full membership fees, but over the past several months there have been a growing number of consumer complaints.

“It looks like card companies have responded passively to our advice and failed to educate the necessary employees about offering full reimbursement voluntarily,” the official said. “We plan to take stern measures against card companies that do not carry out reimbursements according to related regulations.”

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