This is an industry that continues to beg for government intervention. I don't think that I'm alone in my complete disgust with this industry. Everything they ever wanted was given to them courtesy of active efforts in the US, UK, Europe and around the world. They own this credit crisis and are still being treated too gently and that really has to change. As much as I avoid using plastic, this is still incredibly unfair considering how much regular taxpayers have done to save their sorry businesses.
Banks have increased interest rates on credit and debit cards held by tens of millions of shoppers despite the cost of borrowing falling to its lowest level for more than 50 years, research for The Independent reveals today.
The Bank of England has almost halved its base rate from 5 to 3 per cent since May, but during the same period the average annual percentage rate for credit cards has climbed from 17.2 to 17.6 per cent. Store cards – already in the spotlight after being accused of carrying excessive rates – have hit a peak of 25 per cent, and the high street chains Principles, Karen Millen and Oasis have raised charges for their in-store cards by 4 percentage points – almost a sixth – to 28.9 per cent.
More than £200bn is owed by Britons in unsecured borrowing, including personal loans, overdrafts and credit and store cards – almost one-fifth of total lending.
While the banks have been heavily criticised for failing to pass on the Bank of England's interest rate cut to their customers, so far providers of "plastic" – which include the same banks and some specialist players – have escaped scrutiny for failing to do likewise with their credit cards.
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