RBA cuts rates but Credit Card Interest Rate Rise!
4 September 2008
Something very strange happened this week. As expected the Reserve Bank of Australia lowered interest rates by 0.25%. Happy days! Why then have many credit card providers raised interest rates on their credit cards over the last few months and even one this week by up to 2.75%.
If you've noticed that your credit card interest rates have been gradually rising, you're not alone. Several major banks and lenders in Australia have slowly been increasing their credit card interest rates.
Banks often defend the fact that interest rates on credit cards are twice the amount of interest rates on mortgages by claiming that lending on credit cards is riskier.
If you're unimpressed with any interest rate rises on your credit cards, you might like to consider a balance transfer. A balance transfer allows you to shift the debt on your credit cards to a credit card with another financial institution. You can also combine multiple credit card debts into one account.
Here's the good news, many balance transfer credit cards offer introductory periods that are interest free or have low interest rates. If you are not happy with the rate rise handed out by your credit card provider then give yourself a rate cut by getting a balance transfer.
Compare credit card balance transfers at CreditCards.com.au.
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