Credit crunch causes credit card chaos
In the last two months, no less than 125 fee and rate increases have hit the credit card market, research from Moneyfacts.co.uk reveals.
A survey carried out by Moneyfacts.co.uk reveals in the last two months credit cards have been hit hard by rising charges, in particular cash withdrawal fees and rates,
- 69 cards have seen increased cash withdrawal fees
- 25 cards now face higher cash withdrawal rates
- 18 cards have been hit by higher foreign usage charges
- 10 cards have higher balance transfer fees
- 3 cards have increased purchase rates
and many cards would have suffered a combination of these rises.
Esther James, credit card analyst at Moneyfacts.co.uk – the leading independent financial comparison site, comments:
“Its seems as if the credit crunch is beginning to cause credit card chaos. 125 fee and rate increases inside two months is quite staggering. With the majority of increases staying away from the headline purchase rates, these fee and rate increases are less in the public view, and often tucked away in lengthy terms and conditions. However they can still make a substantial increase to the cost of using your card.
“With Christmas coming up, incomes will be stretched to the max with more people perhaps turning to their plastic for access to additional cash, only to get stung by still higher rates and fees.
“Choosing the wrong card can be a costly mistake. With almost 300 credit cards to choose from, there is plenty of choice.
“Avoid taking cash from your credit card unless you absolutely have no choice. Interest rates average 23%, and are charged from the date of withdrawal. Also expect to pay a fee of up to 3%. Would you still withdraw £500 if you knew that by making only the minimum repayments (2.5%, min £5) you would repay a total of £1382.70. That’s £882.70 extra in interest over a term of 20 years and 4 months?
“Don’t just keep to the minimum repayments, take control of your debt and repay as much as you can afford each month. Doing so will knock years off your debt and save you a fortune in interest.
“Following a year of rising rates and fees, its time to take a look at your card. Check the interest rate you are paying, as there are still some great 0% deals on purchases and balance transfers to be found. So don’t pay interest unnecessarily. Make sure you look after your own pocket instead of fuelling the profits of the card providers.”
Full details of the recent changes can be found below:
Credit Card Cash Fees
Provider |
Cards |
wef |
Old |
New |
AA |
Credit Card MasterCard, Online MasterCard |
17.9.07 |
2.5% min £3 |
3% min £3 |
Alliance & Leicester |
MasterCard/Visa, Moneyback Rewards MasterCard/Visa |
22.10.07 |
2.25% min £2.50 |
3% min £3 |
Amazon |
MasterCard |
17.9.07 |
2.5% min £3 |
3% min £3 |
Bank of Scotland |
All cards |
17.9.07 |
2.5% min £3 |
3% min £3 |
Co-operative Bank |
All cards (except Clear Via & Shelter Visa) |
1.10.07 |
2.5% min £2.50 |
2.5% min £3 |
Halifax |
All cards |
17.9.07 |
2.5% min £3 |
3% min £3 |
Intelligent Finance |
Flat Rate MasterCard |
17.9.07 |
2.5% min £2.50 |
3% min £3 |
Nationwide BS |
Classic Visa, Gold Visa, Comic Relief Visa |
17.10.07 |
2% min £2 |
2.5% min £3 |
Northern Rock |
Base Rate Visa |
1.10.07 |
2.5% min £2.50 |
2.50% min £3 |
Sav Credit |
Aqua MasterCard |
18.9.07 |
2.5% min £2.50 |
3% min £3 |
Smile |
All credit cards |
1.10.07 |
2% min £2 |
2.5% min £3 |
Yorkshire BS |
Classic Visa, Base Rate Tracker Visa |
1.10.07 |
2% min £2 |
2.5% min £3 |
Moneyfacts.co.uk – the money search engine |
||||
Credit Card Foreign Charges
Provider |
Cards |
wef |
Old |
New |
AA |
Credit Card MasterCard, Online MasterCard |
17.9.07 |
2.75% |
2.95% |
Amazon |
MasterCard |
17.9.07 |
2.75% |
2.95% |
Bank of Scotland |
All cards |
17.9.07 |
2.75% |
2.95% |
Britannia BS |
Classic & Platinum Intro Visa |
17.9.07 |
2.75% |
2.95% |
Intelligent Finance |
Flat Rate MasterCard |
17.9.07 |
2.75% |
2.95% |
Moneyfacts.co.uk – the money search engine |
||||
Credit Card Cash Rates
Provider |
Cards |
wef |
Old |
New |
American Express |
Platinum Moneyback Amex |
29.10.07 |
25.9% (+2%) |
27.9% |
Bank of Scotland |
Charity Cards |
17.9.07 |
22.95% (+1%) |
23.95% |
Co-operative Bank |
Advantage Visa, |
1.9.07 |
18.9% (+5%) 18.9% (+5%) 19.9% (+4%) |
23.9% 23.9% 23.9% |
Goldfish Bank |
Buy and Fly! MasterCard |
1.9.07 |
23.9% (+2.9%) |
26.8% |
Halifax |
Charity Cards |
17.9.07 |
22.95% (+1) |
23.95% |
Marks & Spencer Money |
&More MasterCard |
17.10.07 |
20.9% (+1%) |
21.9% |
Nationwide BS |
Classic Visa, Gold Visa, Comic Relief Visa |
17.10.07 |
21.9% (+1%) |
22.9% |
Smile |
Classic Visa, Current Account Customer Classic Visa, |
1.9.07 |
21.9% (+2%)
19.9% (+4%)
|
23.9%
23.9% |
Yorkshire BS |
Classic Card |
1.9.07 |
15.4% (+8.5%) |
23.9% |
Moneyfacts.co.uk – the money search engine |
||||
Credit Card Balance Transfer
Provider |
Cards |
wef |
Old |
New |
NatWest |
Credit Card MasterCard/Visa, Gold Account MasterCard/Visa, Platinum MasterCard/Visa |
18.9.07 |
2% min £5 |
2.5% min £5 |
Royal Bank of Scotland |
Credit Card MasterCard/Visa, Gold Account MasterCard/Visa, Platinum MasterCard/Visa |
18.9.07 |
2% min £5 |
2.5% min £5 |
Tesco Personal Finance |
Bonus MasterCard/Visa, |
18.9.07 |
2% min £2 |
2.5% min £2 |
Alliance & Leicester |
MasterCard/Visa, Moneyback Rewards MasterCard/Visa |
22.10.07 |
2.25% min £2.50 |
3% min £3 |
Moneyfacts.co.uk – the money search engine |
||||
Credit Card Purchase Rates
Provider |
Cards |
wef |
Old |
New |
American Express |
Platinum Moneyback Amex |
29.10.07 |
15.9% (+3%) |
18.9% |
Goldfish Bank |
Buy and Fly! MasterCard |
1.9.07 |
16.9% (+1%) |
17.9% |
Marks & Spencer Money |
&More MasterCard |
17.10.07 |
17.9% (+1%) |
18.9% |
Moneyfacts.co.uk – the money search engine |
||||
Moneyfacts Group
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