New charge for credit card users

PricewaterhouseCoopers warns that an annual fee of £35 could be introduced, something that David Kuo from the Motley Fool believes will lead to more debt management problems.

“Some people wouldn’t be able to move their credit card balance anyway, simply because they have nowhere to move it to,” he warned.

For those who cannot clear their credit card debt, Mr Kuo believes that “they will have to absorb the £35 per year charge”.

This is likely to lead to a “two tier market” he adds, between those who can clear debt on their credit cards and those who cannot.

For those who are saddled with credit card debt, Mr Kuo states that they are likely to be saddled with the choice between paying an annual fee or higher interest rates, both of which would add to debt.