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Government plans crackdown on credit card firms

Government plans crackdown on credit card firms

Category: Credit cards

Updated: 17/03/2009
First Published: 17/03/2009

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 It is now over 6 months old so the content may be out of date.

Plans are in place to prevent credit card companies from raising the amount that can be borrowed when this has not been requested, it has emerged.

Government ministers have confirmed that legislation is to be proposed, in order to protect customers from the temptation to borrow more than they can afford.

Consumer affairs minister Gareth Thomas explained that the move is being taken because it is "vital" that Britons be protected in the current economic climate.

"We are concerned that people may be tempted to borrow irresponsibly if credit card companies increase borrowing limits without this being requested by customers," he remarked.

The government is also considering banning unsolicited credit card cheques, which often charge more than the cards themselves.

Abbey recently encouraged borrowers to considering transferring their debt to zero per cent balance credit cards after finding that £9 billion in avoidable interest charges are being paid each year.

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