It has been reported recently that credit card customers in the UK are still paying through the nose for their credit card borrowing, with providers having increased rates again this year despite the fact that the base interest rate has remained at its all time low of just 0.5 percent for over two years now.
Campaigners are concerns that credit card customers are being made to pay for the problems that banks and financial institutions have experienced over recent years through being charged these astonishingly high rates of interest. Around eighteen popular credit cards have had the interest rates on them increased since the start of this year whereas in the first four months of last year rates on only four cards were increased.
The average purchase interest rate on credit cards is now said to be 19.1 percent, which is the highest it has been in thirteen years. This means that consumers who may already be struggling with their finances will now be hit even harder on their borrowing because of the high rates of interest that are being charged on their cards. Many officials believe that these rate rises will continue as a result of credit card providers also being hit with the new rules relating to Payment Protection Insurance compensation, which will cost them dearly. Increased rates will provide one way to help them to claw back some of the money that they lose through having to make compensation payouts to customers who believe that they were mis-sold PPI cover when they took out their credit card.
One financial industry official said: ‘Card providers have also been hit by claims for PPI misselling, which has seen them having to repay money to customers. It is unlikely we have seen the last of these rate rises.’
Similar Posts:
- Don’t get talked into a high rate credit card
- Ways to cut your credit card interest rate
- Students Borrowing for College Way Up
- Consumers steering clear of store cards
- Study Shows the Credit CARD Act Has Made a Positive Difference
Tags: Credit Card, Rates
Recent Comments