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15 Dec 2019

Go Direct Personal Finance News  2009

Credit card rates soar

Since the start of the year rates on 18 credit cards have increased compared to just four in the same period in 2010.

Credit card providers have increased rates by between 0.6% and 2.0% (See table for full list of increases.

As a result of the increases, the average interest rate charged on credit cards now stands at 19.1%, the highest level in 13 years.

Michelle Slade, spokesperson for Moneyfacts.co.uk, commented:

“At the start of 2011 card providers moved to a positive order of repayments as recommended by the Office for Fair Trading, which has dented the revenue levels they can earn from customers.

“Card providers have also been hit by the PPI ruling which has seen them having to repay money to customers deemed to have been mis-sold the insurance.

“At the same time, there has been a sharp increase in the number of providers raising the interest rates charged on their credit cards.

“Several of the biggest providers of credit cards, including Barclaycard, Halifax, Royal Bank of Scotland and Santander, have been party to the increases.

“It is unlikely we have seen the last of the increases and Moneyfacts expects more providers to follow suit.

“While credit card interest rates have risen, customers are now being offered the longest ever 0% balance transfer and introductory purchase deals ever seen.

“Providers hope to bank on customers’ reluctance to keep switching and can claw back the lost interest during intro periods once they end.

“In an ideal world customers should look to repay their balance in full each month; that way no interest is payable.”

Credit Card Table

Provider

Card

Previous Rate

Current Rate

Increase

Bank of Scotland

All in One for Current Account Customers MasterCard

15.9%

17.9%

2.0%

Bank of Scotland

All in One MasterCard

15.9%

17.9%

2.0%

Barclaycard

Platinum with Balance Transfer Visa

16.9

17.5%

0.6%

Barclaycard

Platinum Simplicity Visa

6.8%

7.9%

1.1%

Halifax

All in One for Current Account Customers MasterCard

15.9%

17.9%

2.0%

Halifax

All in One MasterCard

15.9%

17.9%

2.0%

NatWest

Platinum Branch/Telephone Credit Card MasterCard

16.9%

17.9%

1.0%

NatWest

Advantage Gold Credit Card MasterCard

15.9%

16.9%

1.0%

NatWest

Current Account Holders Classic MasterCard

16.9%

17.9%

1.0%

NatWest

Advantage Gold Account Holder Classic Card MasterCard

15.9%

16.9%

1.0%

Royal Bank of Scotland

Platinum Branch/Telephone Credit Card MasterCard

16.9%

17.9%

1.0%

Royal Bank of Scotland

Royalties Gold Credit Card MasterCard

15.9%

16.9%

1.0%

Royal Bank of Scotland

Current Account Holders Classic MasterCard

16.9%

17.9%

1.0%

Royal Bank of Scotland

Royalties Gold Account Holder Classic Card MasterCard

15.9%

16.9%

1.0%

Sainsbury’s Finance

Credit Card MasterCard

15.9%

16.9%

1.0%

Santander

Credit Card

16.9%

17.9%

1.0%

Santander

Zero Credit Card (New Customers)

18.9%

19.9%

1.0%

Santander

Zero Credit Card (Existing Customers)

18.9%

19.9%

1.0%

Source: Moneyfacts.co.uk 5.5.11

 

Moneyfacts Group
Moneyfacts is the UK’s leading independent provider of personal financial information and our data is used and trusted throughout the financial industry.

 

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