Experts warns store card rates have increased despite regulation

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Experts warns store card rates have increased despite regulation

Mon 9th Jun 2008

Despite new regulations introduced last year to govern the promotion and administration of store cards, an investigation by Fool.co.uk has found that some stores have increased their interest by as much as seven per cent since May 1st 2007.

However, the average store card interest rates have dropped over the same period by 0.7 per cent, from 25 per cent in May last year to 24.3 per cent today.

Ikea was found to have increased its rates by seven per cent, while Marks & Spencer raised its interest by four per cent and Argos followed suit with a two per cent hike.

Ed Bowsher, savings expert at the website, went as far as to describe store cards as "the devil in disguise".

"Store card-holders should be aware of the high interest rates which come hand in hand with introductory offers - and should remember that these cards are designed to make you spend, rather than help you save, money," he warned.

Moneyexpert.com notes that store cards are often targeted at young, financially inexperienced shoppers, who may be tempted by the introductory discounts on offer.

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