Related Credit Card Article

"AA credit card makes changes in consumers’ favour"

By Reno | September 2nd, 2010 | General

Changes have been made to AA credit cards that are designed to help consumers to save money on interest. In the past credit card providers have used repayments made by cardholder to pay off the cheapest credit first, which has left higher interest balances to accrue interest. This is something that caused a lot of controversy amongst campaign groups and consumers, and it was finally announced that new regulations would be brought in to ensure that credit card companies used the repayments from cardholders to repay the higher interest debts first.

The changes to regulations are due to come in later this year. However, a number of credit card providers have decided to throw down the gauntlet by bringing the changes in early, which mean that cardholders can start to benefit right away rather than having to wait until the changes become mandatory, which would be a few months down the line.

It has now been announced that AA credit cards have become the latest to decide to bring the new regulations in earlier than necessary, and repayments made by cardholders will now be paid against the higher interest balances on the card first before being allocated to the lower interest balances.

The changes to these AA credit cards will benefit consumers who make gradual repayments on their balances because it means that they will be able to save money on interest on their debt.

Mark Huggins, the director of AA Financial Services, said that plans were underway to make the switch, stating: “This is a vital step towards helping millions of card holders to manage their debt. It is a change that the AA wholeheartedly endorses.”

Tags: debt, Credit Cards, credit card, interest

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