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04/02/2005
Credit card firms called on to offer 'fairer deals'
A report by the Treasury Select Committee (TSC) has called on credit card firms to improve the clarity of information and offer fairer deals to their customers.
The TSC's new report into the UK credit card market is the second to be issued during the two years the committee has spent investigating the industry.
The report called for credit card companies to share more data and stop issuing unsolicited credit card cheques, in order to stop customers running up massive debts. It also called for better clarification regarding penalty charges and exceeding credit limits, as well as clearer interest rate calculations.
The committee had criticised the marketing techniques used by credit card companies, saying that it made it "virtually impossible" for consumers to compare the many deals offered on the market.
However, the committee admitted that the industry had made some progress towards improving the situation, most notably through the introduction of the Summary Box and warnings against the consequences of only making minimum repayments.
The Association for Payment Clearing Services (APACS), the trade association for the UK payments industry, welcomed the report.
Sandra Quinn, Director of Communications at APACS, said: "We believe we have made important strides forward and we are glad that this has been recognised by the TSC. We will continue to engage with the issues of transparency and competitiveness and, where we can improve, we will act."
However, Liberal Democrat MP, Norman Lamb, said: "This report acknowledges that significant progress has been made but there is still a long way to go. I have concerns about the scale of charges for breaching overdraft limits and missing payment deadlines. The next big issue for banks is to apply the same principles of transparency to bank accounts, where customers are still kept unacceptably in the dark over charges."
(KMcA/SP)
The TSC's new report into the UK credit card market is the second to be issued during the two years the committee has spent investigating the industry.
The report called for credit card companies to share more data and stop issuing unsolicited credit card cheques, in order to stop customers running up massive debts. It also called for better clarification regarding penalty charges and exceeding credit limits, as well as clearer interest rate calculations.
The committee had criticised the marketing techniques used by credit card companies, saying that it made it "virtually impossible" for consumers to compare the many deals offered on the market.
However, the committee admitted that the industry had made some progress towards improving the situation, most notably through the introduction of the Summary Box and warnings against the consequences of only making minimum repayments.
The Association for Payment Clearing Services (APACS), the trade association for the UK payments industry, welcomed the report.
Sandra Quinn, Director of Communications at APACS, said: "We believe we have made important strides forward and we are glad that this has been recognised by the TSC. We will continue to engage with the issues of transparency and competitiveness and, where we can improve, we will act."
However, Liberal Democrat MP, Norman Lamb, said: "This report acknowledges that significant progress has been made but there is still a long way to go. I have concerns about the scale of charges for breaching overdraft limits and missing payment deadlines. The next big issue for banks is to apply the same principles of transparency to bank accounts, where customers are still kept unacceptably in the dark over charges."
(KMcA/SP)
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