Shouldn’t they clear my name?

Can you please help. I have a credit card.

In April this year the bank phoned to say that I owed them P1,200 for the card because they were not able to deduct as we have agreed from my account because their system was down. I paid the money in June. Recently, I went to the same bank to apply for a loan and they declined the application saying that they have blacklisted me even though it proves that I don’t owe them after checking.

Are they not supposed to clear my name?

The first problem is that banks aren’t perfect. They make mistakes. Their systems sometimes let them (and us) down. Clearly that happened when they failed to deduct your monthly credit card payments. Surely their expensive computer system has the ability to tell both them and you that there’s been a problem and then to send a reminder that a payment failed and someone needs to take an action to keep your payments up to date?

However, it was also your responsibility to ensure the payments were made. I know it’s easy to overlook this because we trust our banks to get things right. But they often don’t, so it’s up to us to check.

Secondly, the way credit reference bureaus work is that they record facts. The bank will have updated the system to say that you fell behind with your payments and then later updated it again to say that you’d caught up. However, and this is the important point, those updates stay on your record for up to two years. That enables the bank and other potential lenders to see your recent history and make a judgment on whether they think lending money to you is a good or bad risk.

Given that it’s the same bank that made the mistake that has since declined your loan application, I think it’s worth reminding them who actually caused the problem in the first place. Maybe they should take some share of the responsibility for the situation?