More gloom as Credit Card payments increase

28/08/2008

It seems that there is yet more gloom in the UK economy as credit card companies plan to increase the minimum payments on their credit cards. This comes as yet more bad news for thousands of UK consumers who are battling with trying to keep outgoings to a minimum. This news will particularly affect those card owners who are on a tight budget.

Many credit card users will see the minimum payments on their cards rocket to £25 from an existing £5. Minimum repayments with the Alliance & Leicester will increase from October to £25 plus interest charges from an existing three per-cent or £5.

These changes will mainly affect those card users who have been taking advantage of 0% deals and are paying the minimum amount.

Those households with a lower income bracket will particularly find this a challenge as they try to make ends meet with all the extra outgoings.

Sean Gardner from Moneyexpert.com says,” Such a move could cause problems with people who are managing their debt carefully, especially when everybody's income is so much tighter.” And because people are becoming more stretched, an increasing number are now paying back the minimum.”