Are credit card customers getting forgotten?
According to some industry officials credit card consumers are getting forgotten about when it comes to interest rate movement, with the majority of people concentrating more on mortgage customers. Officials state that there is regular speculation with regards to whether mortgage interest rates will be come down, but there is very little speculation or discussion with regards to the interest rates on credit cards.
One official from fool.co.uk stated: “The Bank of England has trimmed interest rates three times since December 2007. But, despite the cuts, interest charges on outstanding credit card balances remain disgustingly high.” He added: “The typical annual percentage rate on popular credit cards is around 16 per cent, which is over three times higher than the Bank of England base rate. This means we are forking out £7.7 billion in annual interest payments - around £250 for every credit card holder a year.”
He went on to state: “APRs are not set in stone, and are open to negotiations. Every one per cent reduction in APRs represents an extra £74 million that go into consumers’ pockets to ease the credit crunch. It is a fraction of the £50 billion bailout that lenders are grabbing from the Central Bank, which is, after all, our money. Fool.co.uk therefore urges card holders to ask their providers for a reduction in interest rates. Banks may want their cake and eat it, but we deserve a slice too, since we are paying for it.”
A number of recent reports have shown that credit card fees, charges, and rates have been rising, and consumers are paying a fortune for the privilege of using a card in many cases.
