Rate hike would penalise indebted Brits

Dyfrig John, director and chief executive of HSBC bank, says that with personal indebtedness in the UK standing at “pretty serious” levels, many people would be adversely affected by an increase in the underlying cost of borrowing.

Mr John declined to predict whether the bank’s monetary policy committee (MPC) will in fact increase rates, which have remained frozen for the past 11 months, claiming that trends in the market place could point to a hike but also a possible reduction.

Mr John also spoke of HSBC’s recent decision to begin charging for banking, predicting that other banks would also follow suit.

Although charges will not be welcomed by those struggling to clear debt, he pointed out that banking isn’t free to provide.

Additionally, Mr John argued that a number of consumers are already opting for fee-based products, indicating that public support will be forthcoming.

However, he was reluctant to predict whether the Office of Fair Trading would support the widespread introduction of fee-based products.