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Credit cards News - Last Updated Tuesday 9th December 2008 Syndicate this
Credit card companies under serious pressure to reduce their rates substantially

Tuesday 9th December 2008

As we have covered on a number of occasions over the last few weeks, credit card companies across the UK are under serious pressure to pass on cost savings to their customers. Rather perversely, we have seen a credit card rates increase as UK base rates continue to fall substantially and many customers are paying more in interest than ever before. Not only does this take away vital income but it also ensures that less capital is repaid in the short term which will ensure a longer lifespan for many customer debts.

There had been noises from within government to suggest that credit card companies were next on the government's hit list but the mortgage sector does not appear to be under control as yet and any new attack on the credit card companies seems a little way off. Credit card companies in the UK argue they have been hit with increased repayment defaults but in many ways they have never had it so good with net debt across the country still at record highs.

Some of the credit card companies will argue that more and more customers are defaulting and moving towards bankruptcy or IVAs but there is still a feeling that the net impact to the balance sheet of many credit card companies is positive.

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