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"Credit card firms will have to be fairer with consumers"

By admin | February 12th, 2009 | Credit Cards

Over recent weeks credit card firms in the UK have agreed with government officials that they will bring in increased measures to ensure that credit card customers are treated more fairly.

As part of the new measures credit card firms have agreed that they will no longer impose sudden overnight interest rate hikes on consumers, which means that borrowers will not have to worry about finding that their credit card interest rate has suddenly shot up, as may have been the case in the past.

In addition to providing those struggling with their credit card debts with increased breathing space, the credit card firms have also agreed that they will provide consumers with increased warning about any credit card hikes that are due to take place, and will only act on credit card increases at certain times, providing borrowers with more stability in terms of their outgoings in the current difficult financial climate.

Lenders have agreed with government ministers that they will not increase the interest rate on a credit or store card for twelve months following the card being taken out. After this the credit card rate will only be reviewed and possibly changed every six months, and borrowers will receive at least thirty days notice of any interest rate changes before they are applied to the account.

The Consumer Affairs Minister, who was involved in meetings with the credit card industry, stated: ‘I am pleased by the commitments card companies have made to me today. I recognise that these changes will not be without financial pain for credit card companies, but it was vital that we nipped in the bud the bad practices that were causing real hardship for borrowers. These commitments will help families manage their finances and cope with repaying their debts.’

Tags: credit card debt, credit card firms, credit card rate

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