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UK government finally acts on credit card regulations

The UK government has announced the publication of a White Paper on Wednesday which will finally introduce a number of new regulations aimed at curbing the power of the credit card industry. Insiders suggest that one of the main elements of the White Paper will be the banning of unsolicited credit card cheques in the post which have been the first step on the road to significant debt for many people.

The report has apparently obtained figures which suggest that a £500 credit card cheque paid back over just 12 months may carry an additional £150 in charges and interest, equating to an interest rate of 30%. The government is also ready to introduce tighter regulations to cover APR figures which have continued to increase despite the fact that UK base rates have remained at 0.5% for some time. When you consider that UK personal debt is now estimated at around £1.5 trillion, which equates to around £60,000 per UK household, the situation is critical and set to deteriorate further.

Many consumer groups believe that the UK government has been too slow to react to the ever-growing threat of credit card debt which appears to be readily available to even those who have no chance of paying it back. Is this rumoured crackdown on the credit card industry too little too late?

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