• 7 hours Gold Is Still A Safe Haven, But Not Very Alluring
  • 15 hours What Does CHina’s EV Slowdown Mean For The Battery Metals Sector?
  • 1 day COVID Report Cards Will Brand Businesses Forever
  • 2 days Trump Tweet Sends Oil Soaring 25%
  • 2 days Why The Coronavirus Economic Crash Is Worse Than You Think
  • 3 days Is A Global Currency Necessary?
  • 3 days America Has Shed 500,000 Millionaires Since The Coronavirus Lockdown Began
  • 4 days Trump Wants Another $2 Trillion Economic Intervention
  • 4 days The Surprising Businesses Deemed “Essential” During The Coronavirus Lockdown
  • 4 days Priceless Van Gogh "Spring Garden" Painting Stolen
  • 5 days Oil Falls To $20 For First Time In Nearly Two Decades
  • 5 days COVID-19 Could Be The End Of U.S. Coal
  • 5 days How Much Does Your Social Security Number Cost? $4 On The Dark Web
  • 7 days Silver Stocks Have Been Decimated In The Coronavirus Sell-Off
  • 7 days How Blockchain Tech Could Make Mergers And Acquisitions More Efficient
  • 8 days America’s Shortage Of This Metal Keeps Trump Up At Night
  • 8 days Bidet Bonanza: Defying The Toilet Paper Shortage
  • 9 days U.S. Auto Sales Fall By 75%
  • 9 days Violating Quarantine? Big Brother Is Watching
  • 10 days Does Gold Still Have Some Room To Run?
  1. Home
  2. News
  3. Breaking News

UK Credit Card Interest Rates Are Skyrocketing

Credit Card

Credit card interest rates in the UK have hit the highest level in 13 years, according to the Financial Times

Per the report, the average annual percentage rate (APR) reached 24.7% in September - the highest since financial website Moneyfacts.co.uk began recording data. The average APR was 23.4% this time last year. 

"Consumers who turn to credit cards for their everyday purchases will find that the cost to borrow is starting to rise, as the most lucrative low rate cards have worsened," said moneyfacts' Rachel Springall.

"In fact, over the past quarter, we said goodbye to the lowest rate purchase credit card on the market and have seen rates increase on these lucrative offers."

 

This decoupling of soaring credit card rates from flat-to-falling wholesale money rates echoes that of the US where credit card rates have exploded higher in recent months...

Source: Bloomberg

Lenders, meanwhile, have been eliminating low-interest-rate deals after the Financial Conduct Authority (FCA) enacted new rules designed to clamp down on spiralling debts

Tesco Bank recently pulled its 5.9 per cent Clubcard credit card, which was the lowest rate card on the market. Bank of Scotland, Halifax and Lloyds Bank increased the purchase rate on their credit cards from 6.4 per cent to 9.9 per cent. Related: From Millennial To Millionaire With One Simple Trick

Ms Springall pointed out that consumers may be making more efforts to move their debts to an interest-free alternative or clear their balances altogether. According to recent findings from UK Finance, the industry body, there has been a decline in the proportion of credit card balances that bear interest, falling from 54.6 per cent to 53.4 per compared to a year ago. The annual growth rate of outstanding balances has also fallen to 3.6 per cent, down from its peak of 8.3 per cent at the start of 2018. -Financial Times

"Once you are a customer, your card provider can increase your rate if they feel there has been a change in your financial circumstances and they see you as a greater risk," said personal finance expert and founder of consumer website MoneyComms, Andrew Hagger, who added "For those people struggling with their finances, the last thing they need is a higher rate on their plastic."

By Zerohedge.com 

More Top Reads From Safehaven.com:

Back to homepage

Leave a comment

Leave a comment