Independent UK Credit Card Comparisons | Today is Thursday, September 2nd, 2010
 

"Consumers urged to query credit card hikes"

By admin | November 30th, 2009 | Credit Cards

Consumers in the UK are being urged to query any unexplained increases in their credit card fees or interest rates, after industry officials highlighted how many credit card companies were increasing fees and interest rates on credit cards for no reason and without any explanation.

Many credit card firms are trying to recoup losses seen during the last couple of years by hiking up other fees, and one way in which some are doing this is by increasing the interest rate on the account.

Officials have said that in the event that the interest rate is increased on a consumer’s account without any form of explanation the consumer should contact the credit card firm and query the decision to increase the rate.

If the card provider cannot provide an explanation or reason then the consumer is advised to contest the increase. It is thought that many card providers will then back down and return the interest rate to the original one.

In some cases the card provider may claim that the reason behind the rate hike is that the consumer poses a higher risk than in the past, but regulators have said that the provider needs to prove that there is an increased risk, and if it cannot do that then the cardholder should still contest the rate increase.

An official from the Financial Ombudsman Service stated: ‘We expect to see evidence that the card companies have actually assessed the borrower’s risk. Whenever we ask to see this information, we find that the card company moves to a settlement quite quickly.’

Many people fail to question unexplained interest rate and fee increases by their credit card provider, and as a result many end up paying for more than they need to on their credit card borrowing.

Tags: , ,

Related Articles:

  • Consumers can benefit from contesting credit card fees

    Many credit card firms have increased credit card interest rates for customers without any explanation or reason in a bid to make more money from the consumer. However, a recent report has suggested that consumers should always contest any unexplained credit card interest rate increase with their provider, as there is a good chance that...

  • Credit card companies getting tougher

    Credit card companies across the UK are continuing to get tough in a bid to try and minimise on the risk of increasing bad debt levels. Over the past couple of months a number of credit card providers have increased a range of fees, charges, and rates in order to compensation for lost revenue, bad...

  • AMEX interest rate rockets

    Recent reports have shown that one major credit card provider has increased the interest rate on one of its credit cards to over thirty times the base interest rate, charging a massive 46 percent APR on the card. The astonishing interest rate has been applied by American Express on its British Airways Premium Plus credit...

  • Credit card customers urged to take action over rising costs

    The high levels of bad credit card debt in the UK coupled with the effects of the credit crunch that has taken hold in the UK has resulted in a number of credit card providers hiking up various fees and charges over the past couple of months, with over 130 rate and fee hikes reported....

  • Credit card providers increase fees

    Although the base interest rate has plummeted to its lowest level in the history of the Bank of England, standing at just 0.5 percent, it has been reported that some credit card providers have continues to increase their fees and rates, resulting in cardholders having to pay over the odds for their credit card borrowing...

Post A Comment:

  1. They should start doing this all over not just in the UK. Credit card companies take advantage of the fact that they know a lot of people will not notice a slight increase in the annual percent rate. People have to make sure that they are constantly aware of what they are paying for, as well as all the hidden fees to avoid all possible ways meant to get them.

    Comment by Process USA — November 30, 2009 @ 8:49 pm

300x250_Egg_credit_cards

Virgin Credit Card image

Other Recent Articles

Improvements to credit card lending

According to recent reports July saw improvements when it came to credit card lending in the UK, which many believe...

By Reno | September 2, 2010 | Read More

AA credit card makes changes in consumers’ favour

Changes have been made to AA credit cards that are designed to help consumers to save money on interest. In...

By Reno | September 2, 2010 | Read More

Good deals being limited by credit card providers

It has been claimed that good deals on credit cards are being limited by credit card providers, and although many...

By Reno | August 30, 2010 | Read More

Don’t lose your interest free facility on your credit card

Many people these days have interest free credit cards, and this is because these cards can offer great value for...

By Reno | August 27, 2010 | Read More

Default on credit card debt still big risk

It has been reported that banks and credit card providers are still viewing the possibility of defaults on credit card...

By Reno | August 27, 2010 | Read More