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"Credit card costs continue to increase"

By admin | January 7th, 2009 | Credit Cards

Recent results from a survey have shown that credit card costs have continued to rise even though the base rate has dropped dramatically over recent months. Since the start of August the average rate of interest on credit cards has rocketed according to reports, and this has resulted in outrage from many consumers and industry professionals, even causing concern amongst senior government officials including the Prime Minister. Gordon Brown.

One industry official said: “During the past year, card companies have continued to increase the charges on their cards and consumers will find they will be stung more severely than ever before. Just like on mortgages, card companies are factoring in a much bigger margin for the risk of consumers defaulting, so rates are going up rather than down.”

Gordon Brown has apparently been alarmed by some of the increases in credit card charges. He has spoken publicly about the concerns that he has over rising credit card charges, and has said that he wants credit cards firms to take action accordingly. Since he spoke out about credit card charges the base rate has come down even further, and this has put additional pressure on credit card firms to reduce their rates of interest.

Many different credit card costs have been increased over the past few months, and this has all added to the financial pressure faced by borrowers, who already have plenty on their plates in terms of their outgoings. Some of the charges that have gone up recently have included interest rates, withdrawal charges, foreign usage charges, and balance transfer fees amongst others.

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