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Nearly everyone knows that banks make great profits
by charging up to 20% interest on our credit card
debts. But many card companies also have 'hidden costs' which could cost you up to £90 a month in
extra charges.
For instance if you're just a day late with your
monthly payment or of you ask for a copy of your statement the
charges can soon add up. If you're with the
highest-charging card firms, that could add up to £90 in a month
which is enough to erase any savings you might have made by switching to a "cheaper"
deal.
Industry experts believe the new
summary boxes - so-called "honesty boxes" - outlining
charges and rates should make it easier for customers to shop around,
but you still need to be
careful and look at the small print before applying for what looks like a
good deal.
Firms sting you for a range
of charges including late payment, exceeding your limit, not paying
for a direct debit or asking for copies of statements.
The Office of Fair Trading is
changing the law to make card firms outline their charges clearly and
many are already doing it voluntarily.
Quite often consumers only become aware of supplementary charges
after they've been penalised. People tend to concern themselves with
headline numbers when it comes to choosing their credit card,
such as a zero per cent offer, but it pays to check the small print
for the extra charges.
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