Many credit card customers already know how quickly interest charges on their credit card debt can add up, and for many this means struggling to maintain repayments on their debts, which seem to never clear because of increased interest payments that keep getting added on. Over the past couple of years many credit card firms have hiked up the rates on their credit cards, and this is despite the fact that the base rate is now at the same level as it was in 2006.

In fact, many consumers would not be blamed for feeling ripped off by credit card firms, according to some industry officials, as many have been hit with increased interest rates, added annual fees, and soaring fees and charges, often with no explanation and very little notice. With the global credit crunch already causing problems, and many households facing financial problems due to rising energy bills, high food costs, rocketing petrol prices, and soaring living costs, these credit card rate and fee hikes can make all the difference.

Officials from fool.co.uk recently commented on the situation with credit cards, and on official said that the rates on credit cards remained very high even though the Bank of England had reduced the base rate three times since December.

He said: “The Bank of England has trimmed interest rates three times since December 2007. But, despite the cuts, interest charges on outstanding credit card balances remain disgustingly high.” He continued: “The typical annual percentage rate on popular credit cards is around 16 per cent, which is over three times higher than the Bank of England base rate. This means we are forking out £7.7 billion in annual interest payments - around £250 for every credit card holder a year.”

Another official said: “Most of us would normally seek out a new zero per cent deal to tide us over the bad times, but with lenders playing a cautious game, getting one of those cards is more difficult than it used to be. This means more of us will have to use our current credit card and if the 0 percent deal has expired, you’ll be borrowing money at a rate of around 16 percent; be careful what you spend on the plastic because the interest will soon mount up.”

Fool.co.uk has also urged consumers to contact their credit card provider if they are unhappy with a sudden rate rise and challenge them over the rate. In many cases consumers with a long standing history with the provider and a good repayment history can often get the rate reverted back to its original levels.

The official went on to state: “APRs are not set in stone, and are open to negotiations. Every one per cent reduction in APRs represents an extra £74 million that go into consumers’ pockets to ease the credit crunch. It is a fraction of the £50 billion bailout that lenders are grabbing from the Central Bank, which is, after all, our money. Fool.co.uk therefore urges card holders to ask their providers for a reduction in interest rates. Banks may want their cake and eat it, but we deserve a slice too, since we are paying for it.”