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Inconvenient freeze

Rhys used his travel card to buy a television online. When the television was delivered, it did not suit his needs so Rhys returned it to the store and the store processed a credit to his travel card.


The travel card provider did not allow for credits to a travel card unless those credits came from the cardholder’s bank account or an identifiable source. Because the television had been bought from an online retailer, and the credit processed by a physical retailer, the travel card provider did not connect the transactions and identified it as a suspicious transaction, placing a hold on the account. The travel card provider emailed Rhys and asked him to call to discuss the transaction.


Rhys explained that the online retailer and the physical retailer were in fact the same company. The travel card provider’s call centre staff did not have the authority to release the hold, so the hold remained on the account until the suspicious transaction team could review the account again. Rhys was annoyed that the hold could not be lifted immediately, and made a complaint.


Two days later the hold was released, but in the meantime a direct debit payment to Rhys’s energy provider had been dishonoured.


The travel card provider apologised to Rhys and credited $100 to his account. Rhys was not satisfied with the amount of compensation, and referred his complaint to FSCL.



Rhys said it was very inconvenient that he could not use his card for two days. Although he was not overseas, and did have an alternative source of funds, he considered the call centre staff should have accepted his explanation and lifted the hold immediately. In addition, Rhys felt his good reputation with his energy retailer had been tarnished by the dishonoured transaction.


The travel card provider said that its apology and compensation already paid was a reasonable resolution of the complaint.



The travel card provider had good reasons for placing the hold on the account and we thought that the travel card provider’s response was reasonable. Although it took a couple of days to release the hold, during this time Rhys had access to other money. We agreed it would be embarrassing to have a direct debit transaction declined and suggested the travel card provider could write to Rhys’s energy provider and explain.


The travel card provider declined to write to the energy retailer explaining that the travel card is not intended to be used as a transactional card, in the way a credit card is used. The travel card provider said Rhys should not have used the card to pay for direct debits, so it was not responsible for Rhys’s embarrassment.



When we explained the travel card provider’s response to Rhys, he accepted that there was nothing further we could do and withdrew his complaint.


Insights for consumers

From time to time we all experience inconvenience. Where the inconvenience is minor, there is no expectation that compensation will be paid. However, where there are significant consequences we may require a provider to pay compensation. Determining compensation is a balancing act. In this case, we took into consideration the severity of the consequences and the time the matter was ongoing, and found that the travel card provider’s response was proportionate to the inconvenience caused.