Credit card interest rates highest since 2006

By UK CreditCards.com

Card rates highest since 2006

Credit card interest rates in the UK are now at their highest levels for four years, according to new figures released by the Bank of England.

The average interest rate increased from 15.89% to 16.28% during December, the Daily Mail reports.

With the base rate still standing at 0.5%, the gap of 15.78% is the highest ever recorded. Meanwhile, PricewaterhouseCoopers research indicates that Britons have over £54bn in outstanding balances, with bad debt on this total set to increase by 50% to almost £5bn in 2010.

"Credit will become more expensive as lenders attempt to claw back revenue lost as a result of economic and regulatory pressures," noted the accountancy firm.

"This will be felt through increased APRs, an introduction of fee-based lending, or both."

Earlier this week, research by housing charity Shelter revealed that as many as 1 million Britons are currently using their credit cards to help pay their rent or mortgage.ADNFCR-2308-ID-19558188-ADNFCR

Published: 20 January 2010