Credit card interest charges: how to dispute them

If your credit-card or store-card interest looks wrong, dispute the reason it was charged, not just the amount. Real Financial Ombudsman decisions show stronger complaints usually involve firm error, misleading communication, wrong payment allocation or poor financial-difficulty support. Complaints are weaker when statements and repayment terms were clear and deadlines were missed.

This guide is based on published Financial Ombudsman Service decisions about card interest, store-card credit, buy-now-pay-later balances, balance transfers and financial difficulty. It explains what worked, what failed and how to prepare a clearer complaint.

For broader context, our analysis of published Ombudsman decisions shows how credit and banking complaints perform overall, but the DRNs below are the useful pattern evidence.

Key takeaways

• You can challenge interest where the firm caused or failed to prevent avoidable interest.
• A complaint is stronger if you can show a specific error, misleading letter, payment-allocation problem or ignored financial-difficulty request.
• A complaint is weaker if the interest-free period, BNPL deadline or repayment option was clearly shown and you did not meet it.
• Asking for interest to be frozen works best when you show affordable payments, no further card use and why interest stops the balance reducing.
• The Financial Ombudsman Service is free and independent if the firm rejects your complaint.

Who this guide is for

This guide is for people who have been charged interest on a credit card, store card or retail credit account and think the charge was unfair. (If your dispute is about the purchase itself - goods not delivered or not as described - see chargeback vs Section 75 instead.)

It may help if:

• your payment was applied to the wrong promotional balance
• a buy-now-pay-later or interest-free offer ended and you were charged backdated interest
• the firm gave unclear or misleading information about a balance transfer or account closure
• you entered a debt-management plan but interest kept being added
• you were in a payment arrangement and want to understand why interest restarted
• your complaint was rejected and you want to know whether escalation is realistic

The examples below are not general promises. Ombudsman decisions turn on their facts. The point is to understand the patterns a decision-maker is likely to look for.

What real Ombudsman decisions show

Decision	What happened	Outcome	What it teaches
DRN-2245507	Argos Card kept charging interest after the customer entered a debt-management plan. She was paying slightly over the minimum, but much of each payment was being eaten by interest.	Upheld	Financial difficulty does not mean an automatic freeze, but a firm may need to freeze interest where regular payments are being made and interest stops the debt reducing.
DRN-4515032	NewDay sent an account-closure notice that made the customer think it was already too late to complete a balance transfer. He then incurred high ongoing interest.	Upheld	If misleading communication causes avoidable interest, the remedy can include refunding interest and stopping future interest while the balance is repaid.
DRN-5799078	NewDay applied a payment to one finance agreement when the customer intended to clear a BNPL balance before interest started.	Upheld	Payment-allocation disputes are stronger when the amount, timing and account history support the customer's intended allocation.
DRN-6159040	Very charged interest where the customer said the wrong repayment option had been applied.	Not upheld	If repayment options are explained and one option has to be actively selected, the firm may be allowed to charge interest when the customer misses the required steps.
DRN-4742589	Very charged BNPL interest after some purchases were not fully paid before expiry. Statements showed the balances, expiry dates and payment allocation.	Not upheld	Statements matter. If they clearly show what needs to be paid and by when, a missed deadline is harder to challenge.
DRN-6232621	Argos Card was challenged over persistent debt letters, BNPL interest and interest after a payment arrangement.	Not upheld	Interest can resume after a payment arrangement ends if the account terms allow it and the firm has treated the customer fairly.

Sources: Financial Ombudsman Service decisions DRN-2245507, DRN-4515032, DRN-5799078, DRN-6159040, DRN-4742589 and DRN-6232621. Last checked: 01.07.2026.

When interest charges are worth disputing

The strongest complaints are not just "the interest is too high." They explain why the firm caused, worsened or failed to deal fairly with the interest.

The firm gave misleading information

In DRN-4515032, NewDay's closure notice made the account appear already closed, even though the customer still had time to move the balance. The Ombudsman found that this misleading communication caused interest that could have been avoided.

That kind of argument is stronger when you can show:

• what the firm told you
• what you understood from it
• what you would have done differently
• the interest that followed

For example, if a letter stopped you from completing a balance transfer, your complaint should explain the transfer window, the available 0% or lower-rate offer, and the interest charged after the misleading information.

A payment was allocated to the wrong balance

Payment allocation is especially important when you have more than one plan: a normal balance, a 0% purchase balance, a BNPL balance or an instalment agreement.

In DRN-5799078, the customer paid an amount matching the BNPL balance shortly before interest would start. NewDay applied it elsewhere. The Ombudsman accepted that the facts supported the customer's intended payment and directed the firm to rework the accounts and remove interest from the affected agreement.

This type of complaint is stronger if you can show:

• the exact payment amount matched the balance you meant to clear
• the payment was made before the interest-free or BNPL deadline
• you told the firm where the payment should go
• the firm cannot show the instruction was clearly explained or properly followed

You asked for help with financial difficulty

The Ombudsman does not say firms must always freeze interest. But in DRN-2245507, Argos Card was told to freeze interest where the customer was in a debt-management plan, making regular payments and not asking for the debt to be written off.

The decision is useful because it shows the practical test. The customer owed about £500, was paying £17.53 each month, and around £11 interest was being added. The Ombudsman considered that disproportionate because it gave the customer little chance of repaying the balance in a reasonable time.

Your complaint is stronger if you can show:

• you told the firm you were in financial difficulty
• you proposed or maintained affordable payments
• you stopped using the card
• interest meant the balance was barely reducing
• the firm did not offer meaningful support

When the complaint is weaker

Some interest complaints fail because the evidence shows the firm applied the terms correctly.

The interest-free option had to be actively selected

In DRN-6159040, the customer said Very had used the wrong repayment option. The Ombudsman did not uphold the complaint because the terms explained the available options and the deferred-payment option was not available for every purchase. It had to be offered and actively selected.

If your account works like that, do not rely on "I usually used that option." Look for confirmation from the checkout, account screen or statement showing the option was actually selected for the purchase in dispute.

The statement clearly showed the BNPL deadline

In DRN-4742589, some BNPL purchases had not been fully paid before expiry. The statements showed the balances, payment allocation and the dates by which payment was needed. The Ombudsman did not find the interest unfair.

That means a complaint is weaker if the statement clearly set out:

• the promotional balance
• the expiry date
• the amount needed to clear it
• where payments had been allocated

A payment arrangement ended

In DRN-6232621, interest was not applied during a payment arrangement, but it resumed after the arrangement ended. The Ombudsman found that fair on the facts.

If your arrangement has ended, check the written terms. Was the interest freeze open-ended, time-limited or conditional on review? If the firm promised a longer freeze, use that written promise. If it did not, the complaint may need to focus on whether the firm reviewed your circumstances fairly before restarting interest.

How to avoid credit-card interest

The Ombudsman decisions point to practical habits that can prevent many disputes.

• Check the repayment option before checkout. If the interest-free or BNPL option has to be selected, save the confirmation.
• Put every promotional deadline in your calendar. Add a reminder at least a month before the BNPL or 0% period ends.
• Match payments to the balance you want to clear. If you are clearing a specific plan, make the payment amount match that plan where possible and ask the firm to confirm the allocation.
• Read the next statement after every large payment. Do not wait months to see whether the payment went to the right balance.
• Do not assume minimum payments protect a promotional balance. A minimum payment may keep the account up to date without clearing the specific balance that will trigger interest.
• Keep returned-item records. Returns can leave small BNPL balances behind, which may later attract interest if not cleared.
• Act on persistent-debt letters. If the firm warns that interest and charges exceed capital repayments, respond and ask what higher payment would reduce the balance faster.
• Ask for help before arrears build. If you cannot clear the balance, ask for financial-difficulty support before the account reaches default or persistent arrears.

If the deeper problem is that the card or its limit increases should never have been granted, that is a different - and often stronger - complaint: see how to complain about unaffordable lending.

These steps do not remove the need to check your own account terms. They simply make the evidence clearer if something later goes wrong.

How to ask for interest to be frozen or waived

Use different wording depending on the reason you are asking.

If the problem is financial difficulty, ask for a freeze or reduction while you make affordable payments:

1. Say clearly that you are in financial difficulty.
2. Explain the cause briefly, such as reduced income, illness, job loss or a debt-management plan.
3. State what you can afford to pay each month.
4. Explain why continuing interest means the balance will not reduce.
5. Confirm you will not use the card while the arrangement is in place.
6. Ask the firm to freeze interest and charges while you keep to the plan.

If the problem is firm error, ask for the account to be put back as if the error had not happened:

1. Identify the error: wrong payment allocation, misleading letter, missing instruction or unclear repayment option.
2. Show the date and amount of each disputed interest charge.
3. Explain what should have happened instead.
4. Ask for the interest to be refunded or removed.
5. Ask for the account to be reworked and any credit-file impact corrected if relevant.

If the problem is lost chance to avoid interest, such as a missed balance transfer caused by misleading information, explain the realistic alternative. The stronger version is not "I would have done something else." It is "I had time and a practical route to move or clear the balance, and the firm's information stopped me doing that."

What evidence helps most

Build a small evidence pack. A decision-maker should be able to understand the complaint without searching through a long email chain.

Useful evidence includes:

• monthly statements covering the disputed charges
• screenshots of the repayment option selected at checkout
• BNPL or promotional-rate terms
• the statement showing the promotional expiry date
• proof of payments and dates
• any message or call note where you directed a payment to a specific balance
• letters about account closure, persistent debt or payment arrangements
• debt-management plan documents
• income-and-expenditure information, if the issue is financial difficulty
• the firm's final response
• a short table of disputed interest charges

For payment-allocation disputes, include a line-by-line explanation:

Date	What happened	Evidence
3 October	Called firm to pay off BNPL plan	Call note / phone log
3 October	Paid £X, matching BNPL balance	Bank statement
Next statement	Payment applied to different balance	Card statement
Later statement	Interest charged on BNPL plan	Card statement

Replace the example with your own figures. The point is to make the connection obvious.

How to structure the complaint

Use this structure when writing to the card provider:

1. Account and charge: give the account number, card type and the interest charges you dispute.
2. One-sentence issue: explain the problem plainly, such as "my payment was applied to the wrong plan" or "interest continued after I entered a debt-management plan."
3. Timeline: list the key dates in order.
4. Why the interest was unfair: connect the facts to the reason, not just the amount.
5. Evidence list: tell the firm exactly what you have attached.
6. Requested outcome: ask for a specific remedy.

Possible requested outcomes include:

• refund or removal of disputed interest
• a temporary or ongoing interest freeze while you keep to an affordable repayment plan
• reworking the account as if a payment had been applied correctly
• refunding overpayments caused by the error
• removing adverse credit-file information caused by the issue
• confirming the remaining balance and repayment terms in writing

Keep the complaint factual. You do not need legal language. The Financial Ombudsman Service itself tells consumers that complaints do not need to be formal or full of legal arguments.

When and how to escalate

Complain to the card provider first. For most complaints, the business has up to eight weeks to send a final response. If it rejects the complaint, or eight weeks pass without a response, you can ask the Financial Ombudsman Service to look at it.

The Financial Ombudsman Service is free and independent. You do not need to pay a claims company or lawyer to bring a complaint. You usually have six months from the date of the firm's final response to refer the complaint, so do not leave the letter unread.

Sources: Financial Ombudsman Service: how to complain and Financial Ombudsman Service: time limits. Last checked: 01.07.2026.

How HeyRefund can help

Credit-card interest complaints are usually won or lost on structure. HeyRefund helps you turn statements, payment records, firm letters and complaint history into a clearer evidence pack and complaint draft you can send yourself.

You can complain to the firm and escalate to the Financial Ombudsman Service for free. HeyRefund helps you prepare the file so the issue, evidence and requested outcome are easier to follow.