Million set for new credit card charge

25th May 2007

As many as one million UK consumers could be set to face new charges on their credit cards under plans outlined by Barclaycard, it has emerged.

With millions of British consumers already facing credit card debt, the country's largest provider of these services could soon be charging a fee of £10 or £20 to customers who never or rarely use their plastic products.

"We think this is a fair approach and gives customers a choice," said a spokesman for Barclaycard.

However, there is concern among some expert observers, including the director of financial services at uSwithch.com Nick White, that if Barclaycard introduces an inactivity charge the practice will spread throughout the industry.

Mr White said: "Implementing a fee for an inactive credit card customer is not the key issue here, the problem is the level of transparency displayed around the criteria used to select the customer charged."

Earlier this month, the Insolvency Service revealed that credit problems have seen the number of people in the UK entering into Individual Voluntary Arrangements rise by 23 per cent between the first quarter of 2006 and the same period this year.

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