Group slams credit card charges
Updated on 22 April 2009
A consumer group has accused credit card providers of being "out of touch with reality" for raising their rates and charges during the past year.
Which? Money said 28 providers of widely held credit cards had either increased their interest rates and other charges, or reduced the number of interest-free days on purchases during the past 12 months.
It accused the providers of using "tricks" to "squeeze extra cash out of customers".
The group said credit card interest rates had gone up by an average of 0.5% in the 12 months to February 2009, but a handful of providers had hiked their rates by 4%, while others had increased them by 3%.
The increases come despite the Bank of England base rate dropping steeply during the same period from 5.25% to just 1% at the end of February.
As well as hiking their purchase interest rates, Which? Money said many providers had also put up the interest rates they charged on balance transfers, and the fees they charged people when they shifted outstanding debt between credit cards.
Martyn Hocking, editor of Which? Money, said: "At a time when we're all feeling the pinch, it's hugely disappointing that credit card companies are choosing to put the squeeze on borrowers more than ever.
"With interest rates so low, it is time for credit card providers to enter the real world.
"They need to make credit cheaper and their charges more transparent and fair, rather than making it harder than ever for people to make ends meet and pay back their debts."
These news feeds are provided by an independent third party and Channel 4 is not responsible or liable to you for the same.
