Whether Merion — or any debt collector — can add interest or fees to an outstanding amount depends on the terms of the original agreement between you and the creditor. The short answer is: only if those terms clearly allow it.
What can legitimately be added:
- Contractual interest — if your contract or the supplier's terms of trade specify an interest rate that applies to overdue invoices, that interest can be charged from the date the invoice fell overdue. The rate and the basis for charging must be clear in the original agreement.
- Recovery costs — in some cases, terms of trade include a clause allowing recovery costs to be passed on to the debtor. Again, the clause must be explicit and form part of the original agreement — it cannot be introduced after the debt has already arisen.
What cannot be added:
- Interest or fees that have no basis in the original contract or terms of trade.
- Charges that were not disclosed to you before you entered the credit arrangement.
- Amounts that misrepresent what is legally owed — this would be a breach of the ACCC and ASIC debt collection guideline.
If you believe interest or fees have been added without a valid basis, you can dispute them. Use the Dispute a Debt form and explain which charges you are questioning. We will check the original terms with the creditor and respond to you in writing.
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