There are 31 million credit cardholders in the UK. And they rely heavily on spending using their plastic. In the third quarter of this year, £33.2bn was spent on credit cards, while £31bn of repayments were made.
But those who are paying delayed credit card payments are probably thinking that their payments will reduce after last month’s Bank of England’s rate cuts.
Nope! No really…
Rather than passing on the sharp cut in rates, many credit card companies have decided to keep that cut to themselves.
There is a concern in some govt quarters over the irresponsible behaviour by this industry, and one or two credit card companies in particular. E.g. one company has doubled the APR on one customers’ borrowing while they were in debt.
People are concerned about their financial future and trying their level best to stop repossession of their homes, or trying to keep their jobs. An additional worry of having to pay the same old extortionate rates on their credit cards is some thing they can do without.
Obviously, this has not gone unnoticed at the top governmental levels. Lord Mandelson, the Business Secretary and Gareth Thomas, the Consumer Affairs Minister are on the case. They will be meeting the credit card firms to tell them off.. or else!
In the exceptional times of credit crunch, it is a shame that some institutions are making money at the back of misery of so many consumers.
Filed under: General
