Banks and credit card interest rates
Discussion
Can someone tell me why the banks and CC companies aren't getting nailed by the Politicians/newspapers/TV etc for their interest rates, the government claim they want to free up the cash in peoples pockets, but if this were true they would attack CC interest rates, I heard today that Capitol One have a card with a 34% rate, I don't know haw many people use the facilities on cards but it has to be a lot.
It seems to me that Fat boy and his cronies are turning a blind eye to their mates again.
It seems to me that Fat boy and his cronies are turning a blind eye to their mates again.
marshalla said:
Does anyone actually pay interest on credit cards ?
Yes, fools. And posisbly those who've just got the chop.As for the banks, they're laughing all the way to the... er... bank. Make money, f
k up, get free money from the Government. Keep it. Bankers 1, Silly Politicians 0. Nice 
Edited by Simpo Two on Sunday 8th February 20:51
marshalla said:
Does anyone actually pay interest on credit cards ?
No 
Got caught in the "free money, WOOOO! free beer, free motorsport, i'm rich!" trap a few years back when I was (slightly) younger and (a lot) stupider and am still paying off the consequences of it.
Still, should have it paid off by the end of the year thank god!
Podie said:
Adrian, why the big beef with the banks? You don't strike me as the £30k/yr credit "millionaire"...
I haven't got a beef with the banks, but I do think the balance of power tipped a bit back in the dark ages when our wages had to be paid into a bank. It just all seems a bit odd, reducing interest or MLR wont make that much difference to the average man in the street as the banks have to make a margin and can't pass it on for ever, but reducing CC costs would, and I don't hear anyone shouting about it.
Adrian W said:
Podie said:
Adrian, why the big beef with the banks? You don't strike me as the £30k/yr credit "millionaire"...
I haven't got a beef with the banks, but I do think the balance of power tipped a bit back in the dark ages when our wages had to be paid into a bank. It just all seems a bit odd, reducing interest or MLR wont make that much difference to the average man in the street as the banks have to make a margin and can't pass it on for ever, but reducing CC costs would, and I don't hear anyone shouting about it.
I agree what you're saying though. It does seem to me that the balancing act of reducing interest rates to make life easy for some, is now fairly at the detriment of savers.
Spotted an advert for "buy now, pay later" type thing earlier. 29% APR. Ouch.
Adrian W said:
I heard today that Capitol One have a card with a 34% rate, I don't know haw many people use the facilities on cards but it has to be a lot.
No-one HAS to have a credit card. It is, after all, a privilege rather than an entitlement - card companies issue them to make money rather than because they're philanthropic organisations.I'd guess that the card that you mention is for people with poor credit records. The card issuer (not unreasonably) wants to charge a premium to guard against the risk of default. The account holder has a choice as to whether they take out the card - no-one forces them to.
I don't really see that loan and credit card rates are any of the government's business as long as reasonable rates are available to the majority. If sub-prime borrowers want a card, they have to expect to pay over the odds.
Adrian W said:
Is that the perspective of someone who doesn't need to use the facilities on offer, I think that most people who use them have got used to it and see it as an extension of their bank account.
I have a number of cards and, yes, I do use them. If I know I'm not going to be able to pay off the balance monthly, I at least arrange to have it sit on a card that is either (preferably) 0% or a low rate. Someone who spends on a card with a 34% interest rate and doesn't clear the balance has no-one but themselves to blame when they let that debt accrue huge amounts of interest.As for what other people use cards for, I can't speak for anyone other than me. If they choose to use a card as an extension of their bank account, they can either pay the card off when the statement comes in - in which case the interest rate is largely irrelevant - or they're spending more than they can afford, in which case they shouldn't be using it in the way you suggest.
Don't get me wrong - I'm not getting all holier-than-thou about personal debt (following the example of my learned friend, tonker
) but I do think you're missing the point a bit. Card and loan rates generally reflect the risk the lender is accepting - if you're paying 34%, there's probably a reason. If not, you've picked a duff card and ought to do more research.Adrian W said:
WhoseGeneration said:
There is the matter of secured debt and non secured debt.
I would accept that if car finance wasn't so cheapThe final analysis for the lender is that there would probably be some value in the vehicle if the loan went sour.
Credit cards?, all on socialising, ain't any stuff there.
WhoseGeneration said:
Adrian W said:
WhoseGeneration said:
There is the matter of secured debt and non secured debt.
I would accept that if car finance wasn't so cheapThe final analysis for the lender is that there would probably be some value in the vehicle if the loan went sour.
Credit cards?, all on socialising, ain't any stuff there.
I suspect it will say "Subject to status" in small print, Adrian - they'll take a view on who they offer it to based on credit profile.
Still, car makers are seemingly so desparate to shift metal at the moment that perhaps they're willing to take more risk just to get cars off the lot and make their sales figures look less depressing!
Still, car makers are seemingly so desparate to shift metal at the moment that perhaps they're willing to take more risk just to get cars off the lot and make their sales figures look less depressing!
gopher said:
Adrian W said:
Coco H said:
A family member has just taken a mortgage out - tracker 0.34% above base. You can't argue with that
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