Government officers have investigated after some UK banks and stores stopped offering credit cards to island residents.

Marks & Spencer is among those that no longer offer credit cards to customers in the island.

But the big four banks in the island - Isle of Man Bank-RBS, Lloyds, Barclays and HSBC - have all confirmed that they are offering new credit cards and renewals.

An M&S Bank spokesman said: ’Like the majority of UK banks, we no longer offer credit products in the Isle of Man. We apologise for any disappointment this may cause.’

It is understood that M&S stopped offering credit cards to new customers in the Isle of Man in 2016, arguing this is in line with the majority of UK banks and it is no longer viable given the complexity of offering products across different regulatory jurisdictions.

There is no impact on existing island customers, however.

But an investigation by the Department of Economic Development and the Financial Services Authority has found nothing in UK law that would prevent credit card providers from issuing cards to Manx residents.

And the DED has written to providers who have withdrawn services to clarify the legal position.

In a statement, a government spokesman said: ’Over the last 12 months it appears that some card providers who previously offered facilities have taken commercial decisions to limit their offering to UK residents only.

’But we can confirm, following investigations carried out by the DED and the FSA, that new credit cards are still available to residents and renewals are being processed in the normal course.

’The big four banks in the island have confirmed they can continue to offer credit card facilities to residents, and some other large UK based credit card providers have also confirmed that they can still provide facilities.’

The spokesman added: ’Investigations have identified that there appears no legal prohibition under UK law to prevent UK regulated credit card providers from issuing cards to our residents and consequently the DED is currently writing to some other major providers who have previously offered facilities and who have withdrawn to draw this information to their attention.’

A spokesman from RBS International said: ‘We can help Isle of Man residents to apply for a personal credit card – we would do this through NatWest in the UK.

'This credit card is a UK product, but available to Isle of Man residents. Individuals would need to apply online, and their application would be subject to the usual credit scoring procedure used for any type of loan.’

Peter Reid, president of the Isle of Man Bankers’ Association and island director of Lloyds Bank International, said: ’There is concern out there that does need to be addressed. But I do think it’s over-stated.

’The big four banks in the island all offer credit card services. There are other banks that don’t but I can’t speak for the stores.

’The Consumer Credit Act does apply here if you are providing cards from the United Kingdom and as such you would need a licence to provide this or customers would apply directly to the UK. Some of the smaller banks don’t have cards available within their services.’

He said that some of the banks may have different risk profiles and different rules may apply - for example, you may need to be an account holder to apply for a credit card.

But he said the best option was to check with the bank or store first before applying for a card.