Fees 'will not stop credit card use'

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Fees 'will not stop credit card use'

Tue 14th Nov 2006

Following PricewaterhouseCoopers' - the largest professional services firm in the world – prediction that credit card providers could introduce a £35-a-year fee, a spokesperson from price comparison company uSwitch has said that this would not deter excessive card use.

Due to some card-holders having such a high level of debt run up on their cards, the credit card fee would merely force customers to shop around until they found a card provider that did not charge.

PricewaterhouseCoopers has made the estimate in the wake of regulatory restrictions that were put in place in order to lessen the financial impact on people who miss card payments. As a result, banks stand to lose billions in revenue and so could look to introducing the credit card fee.

When asked if the implementation of a £35 credit card annual fee would put people off using their credit cards, a spokesperson from uSwitch replied: "It depends if it's across the entire industry or just individual providers. Obviously people are just going to move to the provider that doesn't charge until they have done all the rounds.

"I think that there are some people who have quite high balances on credit cards and they're not going to have the luxury to just stop using them."

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