More than 160,000 Irish consumers in line to benefit from a new bank scheme offering redress to those mis-sold credit card protection have been warned by the Central Bank to consider their options carefully or risk losing out on refunds from the banks.

Bank of Ireland, MBNA and Ulster Bank have been making contact with 161,000 customers who could be in line for a claim of between €100 and €200 having been mis-sold a credit card protection policy from August 2006.

Not needed

The reason the companies had to set up the voluntary scheme was because in many cases, information provided by them to customers at the point of sale advertised benefits that were not needed.

In some instances banks offered to free customers from liability for unauthorised use of their cards if they was lost or stolen, but made no mention of the fact that this was covered by the card scheme, which made additional insurance unnecessary.

The three financial institutions have been contacting affected customers, who should have received letters and a claim form.

People will now have to complete, sign and return the claim form before the indicated closing date if they are to be considered for redress. For those making a claim, their policies will be cancelled.

"It is important for consumers to carefully consider the letters they receive and decide whether they wish to submit a claim. If you purchased or renewed one of these policies after August 1st, 2006, and have not received a communication, you should contact your credit card provider," director of consumer protection at the Central Bank, Bernard Sheridan, has advised

When a similar redress scheme was launched in the UK, fewer than a third of people who could have applied for a refund actually did so.