Credit card industry to draw up proposals - Credit cards - News - Moneyfacts


Credit card industry to draw up proposals

Credit card industry to draw up proposals

Category: Credit cards

Updated: 28/11/2008
First Published: 28/11/2008

This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

The industry was called in to meet with business secretary Peter Mandelson and consumer affairs minister Gareth Thomas after findings that disproportionately high interest rates are being charged.

Of particular interest was the issue of risk-based re-pricing, which has seen rates increased significantly for certain groups after companies decided their risk levels had changed.

A joint statement revealed that firms are to report back in two weeks with new principles, which will "address issues such as proportionality, frequency and transparency".

"The purpose is to help borrowers manage their debts during the downturn," the statement added.

A commitment was also made to give a 30-day grace period before beginning collections activity when a debt agency notifies a company that a particular consumer is struggling. recently found that the average interest on credit cards is now 17.2 per cent.

Disclaimer: Information is correct as of the date of publication (shown at the top of this article). Any products featured may be withdrawn by their provider or changed at any time.

Related Articles

Reward credit cards that become ‘pointless’

If you regularly use cards to pay at the till, you may have considered opening a reward credit card to earn points every time you spend. However, not all of these cards are as rewarding as they may seem…

It’s looking to be a credit Christmas

We are now less than 70 days away from Christmas, and with 70% of people admitting they haven’t started saving yet, millions will be needing to play catch-up - and plenty planning to turn to credit for some Christmas spending relief.

Can no credit score be as damaging as a bad one?

Debt is becoming an increasing problem, which is why those who have no credit commitments often feel pretty smug about it. However, while not relying on credit is admirable, having no credit score can actually be just as damaging as having a bad one.