Why are credit card rates increasing as base rates fall?
Despite the headline news that UK base rates continue to fall more and more credit card customers are coming forward with news of substantial increases in their interest rates across the board. Many are dismayed that yet again the financial system which they have supporters over the last few months with taxpayer's money would appear to be taking advantage of the situation yet again.
While the average interest rates on credit cards continue to creep higher, even though base rates continue to fall, the larger increases appear to be on an individual basis. More and more credit card companies would appear to be introducing penalties and extra charges to those customers who offer more risk than the average with banks and financial companies looking to protect their investment. However, while the banks look to protect themselves this would appear to be at the expense of customers who have been under pressure for some time.
While the credit card companies are suggesting that interest charges have risen in some cases because of increased risk they do not appear able to explain how interest rates in general have increased, even for many "good risk" customers. There is also the fact that a number of new charges have appeared over the last few months as the banks continue to try increase their profit margins at the expense of customers.
Share this..
Related stories
Confidence is returning but has the economy turned?
Today we see JD Wetherspoon announcing record figures and profits nearly 10% ahead of consensus forecasts, we hear that property prices are yet again on the rise and mortgage liquidity appears to be improving. On top of that there is the assumption that the UK economy may well have left the recessionary period in May this year and looks set to move on to the growth path in the latter part of 2009....
Read MoreBuy-to-let is a rich man's game, says Rics report
The buy-to-let market is now almost exclusively a rich man's game, with the market now almost inaccessible to the average investor, according to a Royal Institute of Chartered Surveyors (Rics) report published today. Interest rates and levels of rental cover ratios for mortgages have made buy-to-let investments an unattractive proposition for many, with would-be-investors needing a £65,600 depos...
Read MoreGordon Brown strikes up a double act with French president Sarkozy
Gordon Brown will this week meet Nicholas Sarkozy to discuss the ongoing economic downturn and ways in which the worldwide economy can be stimulated. The two leaders have become fairly close over the last few months and struck up something of a double act which has surprised many people. The French president seems very much in awe of Gordon Brown's economic prowess and his innovative ways to comba...
Read MoreSavers are advised to find long-term deals before they disappear
As the base rate in the UK continues to fall, having fallen from 5% to 2% in a matter of three months, savers in the UK have been advised to look out for longer-term deals which will lock their funds in at attractive interest rates. There are serious concerns for the plight of savers in the UK and especially those who live off the interest on their savings.
Even though base rates ar...
Bankers pay flourishes in recession
Bankers in the City of London have today been criticised with the revelation that pay packets for the current year increased by 6% to an average of £53,223. At a time when UK taxpayers have literally "loaned" individual banks and the banking system as a whole, hundreds of billions of pounds, it seems that taxpayers are yet again being short changed and the bankers of the UK are flourishing again....
Read More