The Bank of Israel has ordered credit-card company Visa Cal to compensate customers retroactively for its failure to provide information about high interest rates on so-called revolving credit cards. "The banking supervision department at the central bank has recently received complaints by customers [regarding] problems with Visa Cal's 'Active card,'" the Bank of Israel reported Tuesday. "The complaints showed that many customers were not aware that the type of card they were holding was a special one that provides a nonbanking credit framework rather than a regular bank credit." The central bank published information on the conditions and interest charged by credit-card companies Visa Cal, Isracard and Leumicard for their revolving credit cards. Many customers do not understand how revolving credit cards work and unintentionally were paying high interest rates, the bank said. Leumi Card's "Multi," Visa Cal's "Active" and Isracard's "More" are revolving, meaning the balance is carried over to the next month with minimum monthly payments. Revolving credit cards don't have a fixed number of payments and the balance can fluctuate over time. They are suitable for customers who want to have more freedom to spend but don't want to pay back the full balance each month. Visa Cal charges the highest interest on its revolving credit card, an average of 14.4%, as of the third quarter of 2009, compared with 8.96% charged by Isracard and 10.1% by Leumi Card. "It was found that customers are not aware that they have to get in touch with Visa Cal every month, otherwise they will be made subject to a minimum repayment determined by the company and the remainder will be carried into the coming months at a high interest rate," the central bank said. "Furthermore, the rate of interest charged on the revolving credit cards was only brought to the attention of the customers at a later stage and only after they used the card for the first time." Since Visa Cal only notified customers about the interest rate when they received their first monthly statement and not before using the credit, the Bank of Israel has ordered it to compensate its card holders and lower its 14.4% interest rate retroactively to that of a regular credit framework, 8% to 9%. Retroactive compensation will apply to Active card holders who canceled the card or stopped using it for additional credit within six months of first using the card. Visa Cal will not be obliged to compensate customers if full information about the interest rate was disclosed before the card was used, the central bank said. The Bank of Israel also ordered Visa Cal to make changes to the way the Active card is marketed, which will come into effect in February. It wants Visa Cal to let customers who use the Active card to have the option of a fixed monthly repayment of credit rather than having to contact the company each month. Visa Cal will have to provide its customers with an information sheet containing the credit framework conditions, the amount of monthly repayments as determined by the customer, date of monthly payments and the interest rate.