Changing No to Yes

©Beth Austin, 2001

My mother always said of me that I dance to the beat of a different drummer and it's true. I am an independent business woman living in an industrialised country, and, up until a short time ago, I had no credit cards. For years I've been operating on a cash basis, and with the advent of EFTPOS, I've even done without a cheque account.

Now, as a freelance writer doing business on the internet, I need a credit card to register with Paypal.com so I can accept payments online through my account with them.

I was in a chicken and egg situation. It's difficult to get credit when you don't have credit. In addition, I keep my money in a savings society, not a bank, and they don't issue credit cards. I'd have to apply through a bank where I didn't even have an account. A tailor-made opportunity to practice my 'asking' letter technique. See My Speciality is Nasty Letters.

The balance of power here was definitely in favour of the bank. They have no obligation to issue credit cards to customers who don't meet their criteria. I was sure I wouldn't, and I'd need to convince them that it was in their interest to have me as a customer and ask them to make an exception to policy on my behalf.

To make things easier, I selected a bank with which I had a banking history. I'd closed my account with them a year previously in protest against what I considered exorbitant fees, but I'd been a good customer while I was with them. As I expected, my application was declined. Time to implement Plan B.

The clerk who processed my application told me it was declined because of inadequate residential history. This was a good opening for me. I arranged to have my application forwarded to their credit department along with a letter outlining my complete residential history for the past 3 years, references from my landlords (I rent and, although I've lived in the same geographical area, I've shifted several times.), and copies of my phone and power bills, which were always paid on time.

I also included documentation supporting the fact that I am a freelance writer doing business on the internet and needed the credit card in order to collect payments via Paypal.com.

By return mail I received their second refusal, a form letter stating that "after careful consideration. . . based on specific criteria which must remain confidential with the bank" my application was declined. Time to implement Plan C.

After a flurry of phone calls and emails, I was able to elicit that their refusal was based on the assessment of my income and assets. Not surprising since I'm on a limited income and my only assets are a 7 year old computer system and a 20 year old car.

They would not disclose their minimum requirements for "income and assets" and my offer to accept a $500 credit limit and maintain a credit balance in my account (by depositing $500 immediately) fell on deaf ears. Their lack of response to my question, "Was there anything adverse on my credit report?" convinced me they'd never even checked it. Time to implement Plan D.

I sent the entire package to the Banking Ombudsman asking for their help. They responded that they couldn't review the bank's decision " unless you are of the view that there was some failure of administration involved." I read this as bureaucratic gobbledygook for "our hands are tied," although I did write saying I thought it was a failure of administration and would they please pursue the matter further. They contacted the bank about my complaint but that was all they were able to do for me. It did add to the 'squeaky wheel' effect, which was some help.

The credit manager at the bank was getting testy at about this time. He wanted shut of me and I just wouldn't take 'No' for an answer. He asked me if I thought the bank had an obligation to issue me a credit card. My response was 'Yes,' because I'd given them better reasons for issuing me a credit card than the reasons they gave for declining my application. I asked again if they'd found anything adverse on my credit report. That question remained unanswered. Time to implement Plan E.

I went to the local MP's office and lodged a complaint. My argument was; there is a lot of politicking about stimulating the economy in this region and the local banks were not being supportive of small businesses. The assistant I spoke with pointed out that I'd only tried one bank, so my premise was on shaky ground. She also said banks have the right to refuse to extend credit at their discretion, but she would 'look into it.'

That was fine by me. I knew that a phone call from my local MP's office would put the cat among the pigeons. No one, especially a major national bank, wants to be slated by the incumbent government representatives.

About a week later I received an email from the bank's credit manager to tell me they would issue me a credit card and, by the way, there was nothing adverse on my credit report. I phoned the local MP's office. Yes, the assistant I'd dealt with had contacted the bank, but only to verify my story. Yeah, right.

In the meantime I'd gone to another, smaller bank and applied for a credit card - to back up my claim that the local banks were not being supportive of small businesses. They approved my application on the spot and I received their credit card before the one I'd been arguing for from the other bank for 3 months - and it has a higher credit limit.

Now I have 2 credit cards. I use one for business and one for personal transactions. Makes the bookkeeping easier.