Leading financial website thisismoney.co.uk reports that many credit cards have bumped up their interest in time for the holiday season. Quel surprise! Not only are standard interest rates on the up, but charges for using cards abroad and withdrawing cash from the hole-in-the-wall have also taken a sneaky hike. Here’s an extract from the article:

The increases are a hammer blow to families heading off on summer holidays, which generate the biggest card bills of the year on items like hotels, food and car hire.

Britons are expected to spend £22bn on credit cards during July and August. With 13.8m customers regularly failing to pay off their balances each month, the rate increases will bring a cash bonanza for the card companies. Almost one in three customers have faced a rate rise in the past year.

Credit cards have their uses of course, but it’s the fact that 13.8m customers regularly fail to pay off their balance, plus the frequency of interest rate changes, which can sting. It’s essential to fully understand the terms of any credit offer before committing, but the trouble with credit cards is that terms can then change during the life of your card and the banks want to keep your balance running indefinitely.
They can provide cheap credit, but also hidden charges, changing costs and the risk of a spiralling balance. A small, short term loan from Wonga on the other hand may cost more in some instances, but the total amount repayable is always explained upfront, with total clarity. The interest rate won’t ever change during your loan and you repay it within a few days or weeks, depending how long you want to borrow the cash for.
We make money when you settle your loan and clear your short-term debt, not by continually extending a growing line of credit and bumping up the fees every once in a while!