Those currently in credit card debt could find their situations grow steadily worse, as new research has revealed that rates have reached a 12-year high.
Compiled by Moneyfacts.co.uk, the statistics have shown that this figure has peaked at 18.8 per cent, the highest it has been since February 1998, when 21.1 per cent was seen.
Spokesperson for the company Michelle Slade noted that lenders are concerned that people will not be able to repay their debts, a fear driven by the current level of unemployment and which is passed on to both existing and new customers in the form of greater rates.
“Borrowers with £5,000 debt on the card, who just repay the minimum each month, will now repay an additional £2,289 over the life of the debt than they would have in February 2006,” she said.
This follows a recent statement from moneysupermarket.com, which called for more information to be provided to those in credit card debt, with the potential consequences of just meeting minimum monthly amounts clarified.
By Sarah Adie