2nd November 2009
CREDIT CARD FIRMS TO BE FORCED TO END RIP OFFS
Labour has announced they will take tough action to end unfair lending terms by credit card companies. The Government's action will mean:
- Banning the practice of increasing credit limits without prior consent
- Banning unasked for credit card cheques
- Placing restrictions on increasing the interest rate on existing debt
- Raising the minimum monthly repayments levels to encourage people to pay off their debt faster
- Changing the rules so that the most expensive debt on your credit card is paid off first. (Currently most credit card companies make you pay off the cheapest debt first.)
Supporting the move, Labour Candidate for Clwyd West, Donna Hutton has called on credit and store card companies to give people a fairer deal and prevent spiralling debts. Ms Hutton said:
"During this difficult economic time I want to do what I can to help people in Conwy and Denbighshire to manage their finances and cope with repaying their debts.
"What I hear about time and time again are complaints from people about unfair practices and rip offs.
"Whether it is over the top charges in credit card bills, credit repayments or the high cost of credit on things like store cards, it's clear that something needs to be done to help consumers.
"What concerns me most is interest rates being increased without proper explanation. Consumers using their cards responsibly and making payments on time should not pay the price for excessive risk-taking by financial institutions. So I will push for the Government to ban or at least restrict the re-pricing of existing debt."
“Card companies have to get their act together and do more for consumers. Consumers should not feel each month as if they’ve been exploited or disadvantaged.”
ENDS.