Capital One criticised over credit card charges

10 January 2007
Concerns around the profitability of credit card charges are rising as ten of the leading bank cards have increased rates over the last 12 months.

Recent rate hike culprits include Barclaycard, HSBC, MBNA, M&S Money and Virgin Money.

But many commentators have zoned in on Capital One, which now charges 34.9 per cent interest on its Classic Visa card after hiking its rate on purchases by five per cent in 2006.

The interest rate charged for cash withdrawals has also spiralled, with Capital One, Nationwide and NatWest increasing their rates by five per cent. also singles out Capital One for criticism over hidden charges, noting that one of the best ways to cut an overdraft is to avoid hidden charges like the one on the Capital One credit card, which offers 18 months of no interest on transfers only if customers spend £100 on new purchases in the first three months.

Britons spend over £120 billion each year on their 69 million credit cards.

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