£8.8bn of unwanted credit card increases doled out

New research by uSwitch has found that credit card companies are increasing credit card limits to the tune of £8.8 billion to people who did not ask for them.

The study also found that in the last 12 months, 5.7 million people have had their credit card limit increased without their consent by an average of £1,538.

These customers could face an annual interest bill of £5.9 billion.

In contrast, four million people asked for their credit card limits to be increased, and 31 per cent of them had their request turned down.

In total, 31 per cent of all credit card customers have seen their credit card limit move in one direction or another over the past 12 months, 90 per cent of these have been increased by a £13 billion.

Louise Bond, personal finance expert at uSwitch.com, said: "Providers are taking away consumer choice by throwing extra credit at people without their consent."

She added that there were also question marks around how these people are selected for an increase or decrease to their limit and if this in itself is in the customer's best interest.

The news comes as a new government white paper today will outline proposals banning lenders from posting out unsolicited credit card cheques and raising the limits on their customers' credit cards without permission.

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2009-07-02 11:05:32 © Moneyextra.com