Credit card debt has become a problem, and despite the Bank of England base rate of 0.5%, the average credit-card interest rate is still 19%. This is pretty damn high. What does this mean for the credit card customer today?…
It isn’t just the new credit card applicants that are being hit by price rises, existing credit card holders have also seen a jump in their interest rates (the ones they had once though quite safe.) thought they were safe are also seeing huge jumps in their rates.
Credit card companies are quick to blame the government for all their problems, due to increasing unemployment which inevitably leads to people unable to pay their credit card balances. So this has cause credit card companies to look for applicants who have a better credit “score” in order to continue business. But because of the lack of these people too the credit card companies have been forced to up the interest rates too.
Have you noticed that nowhere in this equation has anyone mentioned anything about profit? That’s because it’s taken as normal that the credit card company should still be making masses of profit. Perhaps they should lower interest rates as well as lend responsibly and then we might not be in such a mess anyway? If they too tightened their belts a little more the country could work it’s way out of this.
Tags: Credit card news, interest rates