Banks could limit credit card lending if new rules come into force
29 October 2009
Credit card companies have warned that lower-income applicants would be denied credit cards while special introductory offers would disappear if new regulations about the credit card industry come into force, according to The Times.
The Government is considering banning certain practices by banks and credit card companies, such as the `inverse order of repayment` which means the cheapest debts on a credit card are paid back first, meaning the higher-interest debts have more time to grow.
But banks and credit card companies have warned that they may be forced to limit their lending if the proposals go through.
Other proposals include raising minimum repayments so people repay their debt more quickly, preventing banks from raising credit limits without prior consent from customers, and preventing banks from raising interest rates on existing debts.
Tags: bank, credit card, The Times, banks, credit card companies
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