Credit Cards -
MP vows to grill Egg - 27/02/2008
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Credit card provider Egg - which recently cancelled the accounts of 161,000 customers - is to be grilled by a Labour MP.
The customers were told by the firm that they represented a 'credit risk' - and had been flagged up by an internal report.
However, it has since emerged that many of those affected paid their card balances off each month - leading to suggestions that Egg cancelled the cards in order to maximise profits.
This is because card firms make much of their money through charging interest on outstanding balances.
Commenting, Nigel Griffiths MP said that hewould be meeting with the card provider's chief executive, Ian Kerr and that the firm had "a lot of explaining to do".
Mr Griffiths also suggested an alternative way of card firms gaining funds, so that similar cut-offs would not occur in future, the BBC reports.
"If you want to get rid of customers who are not bad credit risks but who you just don't make money out of, then you should make a charge for your card," he suggested.
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