Barclaycard rate to be linked to the Bank of England base rate?

The_Pedant

I've just had an email from Barclaycard telling me that from Feb 2016, the card interest rate will be linked to the Bank of England base rate:

We're making some changes to the Terms and Conditions of your account. From 1 February next year, your interest rates will start to move in line with any changes to the Bank of England Base Rate.

It seems to me like they're doing the same as the utilities! I notice how in these recent years of low rates that I cannot recall them lowering the rate. Now there's a chance though that the base rate may increase they're introducing an excuse to link the two and save them having to worry about such issues in future as the APR magically climbs higher.

Ok, yes that's an over simplified, one-sided view ... but I'm sure many might read it the same way. Mind you ... as MSE readers know ... always best to pay it off each month!

SnowTiger

Presumably following Halifax's lead.

I wouldn't be surprised if most card providers didn't eventually do this.

It's more transparent than the current system, but does mean that punters won't be able to reject interest rate increases due to a change in the base rate.

Interestingly, two years ago Barclaycard did the reverse. Customers whose interest rate was linked to the base rate were switched to variable rate.

http://www.telegraph.co.uk/finance/personalfinance/borrowing/creditcards/10168378/Barclaycard-paves-the-way-for-rate-rises.html:

Britain's biggest credit card issuer is writing to cardholders telling them their rate will no longer track the Bank of England's Base Rate - paving the way for future increases.

[...]

Just days after the Bank of England's new Governor, Mark Carney, indicated that the Bank Rate would remain low for the forseeable future, Barclaycard has written to some of its customers changing their terms and conditions.

Cardholders with rates that "track" the Bank Rate have been told that from September 1 they will instead be "put on variable interest rates".

Mistaken

I had one of these emails. Is it for everyone and across all there credit cards?

Mine is the simplicity currently at 7.9%