New legislation on credit card debt ‘is only a baby step in the right direction’

New government legislation proposals to combat credit card debt have been described as not doing enough to tackle the problem by an industry expert.

Chris Tapp, director of Credit Action, has said that the plans have missed out on an opportunity to completely overhaul the system.

The scheme means that lenders would not be able to increase limits or rates on what people owe and consumers will have the right to reject such inflation, with payments going to the debt with the highest interest levels first.

Mr Tapp commented: “The government, in our view, is taking a step in the right direction but it is only a baby step.”

Earlier in the month, Lord Marlesford warned against spiralling credit card expenditure, stating that the amount of debt racked up in such a manner had increased by £8 billion over the last year – meaning an accumulative £900 million needs to be paid in interest each month.

By Joe Shervin