How can I know if my credit card is abusive and what can I do?

A credit card is considered abusive when it applies an excessively high interest rate. The amount paid can end up being up to three times the amount borrowed. 

• Has the card payment been going on for years without the debt going down?
• Is the bank demanding payment for a card that has been paid for a long time but the debt has not decreased?

A revolving card may have been taken out without this being realised. Most of these cards contain abusive interest rates.

What is a revolving card?

It is a type of credit card whose particular feature is that payment for purchases, cash withdrawals, etc. made with it is deferred. The main apparent “advantage” is that the cardholder decides how much to pay periodically. In general, a fixed instalment is paid, which is usually low, or a percentage of the outstanding debt.

In reality, these cards work like microloans and apply extremely high interest rates, between 20% and 30%; and by paying a low instalment with such high interest, the debt is extended indefinitely. For a purchase of €1,000, the total amount paid can end up being €3,000.

What can be claimed?

It is possible to recover the excess interest paid on a credit card or reduce the amount of the debt.

The Supreme Court, relying on the Law of 23 July 1908 on the Repression of Usury, in its judgment of 25 November 2015 annulled a revolving card for the first time, considering that its interest rate of 24.60% APR was usurious. The card agreement was signed in June 2001, when this rate was double the average ordinary interest rate on consumer transactions.

It is possible to claim the nullity of the contract and the refund of the excess interest paid. If a claim is made, two situations may arise:

• If more than the amount borrowed has been paid: It is possible to bring a legal claim for the nullity of the contract and the excess principal, plus interest, insurance and any fees charged.