Credit card rates 'increase 3 years after a crisis'

Aussies going online to compare credit cards may want to keep an eye on the rates they pay while they have their plastic as they often increase about three years after a financial crisis.

This is according to banking analyst TS Lim of Southern Cross Equities, who told the Australian Associated Press that after problems in the sector, interest rates drop to "very low levels".

He noted that this often tempts people to use their credit cards even more than they usually would.

However, those who use their plastic regularly may want to take note of his assertion that "three years after a crisis interest rates start to go up again".

Those who are unhappy with the rates they have to pay may want to consider switching to another credit card provider, a move that may enable them to enjoy a grace period with low interest payments on their balance transfers.

This comes after figures from credit information provider Veda Advantage revealed that in the first three months of the year there was a one per cent increase quarter-on-quarter in credit card applications.

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