Australian credit cards 'would fail UK standards'
Article by Mozo
Australian banks are charging excessive fees and interest on credit cards and are failing to meet the more customer-friendly standards that exist in the UK, it has been suggested.
A study by the consumer advocate group Choice noted that the British prime minister, Gordon Brown, recently announced measures to prevent credit card companies from using some of the "sharp practices" that cause consumers to get into debt.
However, it argued that most of the practices to be outlawed in the UK are standard practice for Australian financial institutions.
Choice said some of the key UK changes included bans on unsolicited credit limit increases, reforms that empower consumers to reject interest rate hikes and rules to ensure better disclosure of fees and charges.
The study comes after Westpac came in for criticism this week for introducing new interest charges on existing credit card interest and fees.
Federal treasurer Wayne Swan said the move would encourage customers to compare credit cards in search of better terms, adding: "There are other credit cards that don’t charge interest on fees and no doubt many Westpac customers will be considering those today."
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