'Unfair' credit cards charge Aussies hidden fees

Monday 25 January 2010

Article by Mozo

Aussies are paying more than they expect in credit card interest charges because of a range of hidden fees.

A study of 20 credit card firms by the consumer advocate group Choice found that the amount of interest charged on a credit card can depend as much on when a provider stops and starts charging interest as the actual advertised interest rate, the Australian Associated Press (AAP) reported.

Naming the most unfair credit card providers, Choice picked out American Express, Bankwest, Commonwealth Bank, ANZ and Westpac, among others.

The group noted that some card companies backdate their interest to the day of purchase if a repayment is late, meaning that being late by just one day can result in higher interest being charged retrospectively for up to 55 days.

"Many consumers would be surprised to learn they could have two cards with exactly the same interest rate and use them in the same way yet have one charging twice as much interest than the other if they pay late," Choice spokesman Christopher Azine told the AAP.

He added that such hidden costs make it harder for customers to compare credit cards.

Last week Harry Senlitonga, an advisor at the financial services firm
Canstar Cannex, told the Sydney Morning Herald that a growing number of Australians are now using debit cards to control their spending.

This article is brought to you by Mozo – Helping you compare credit cardsADNFCR-1761-ID-19576199-ADNFCR

Find great rewards credit card deals

Which type of rewards credit card would you like to compare?

Back to top