American Express interest rate rise

dazzaofdagenham

So Bank of England interest rate is at a all time low of .25% and has been low for several years now.

Amex send me a letter today increasing my interest rate from 15.9 to 19.9

Are they living in the real world

[Deleted User]

Whilst customers keep switching CC's and demanding 0% interest for 3 years or more, and such deals are constantly hammered home on sites like this one then its not surprising that they need to charge such rates to people who don't bother to shop around.

dazzaofdagenham

venison wrote: »

Whilst customers keep switching CC's and demanding 0% interest for 3 years or more, and such deals are constantly hammered home on sites like this one then its not surprising that they need to charge such rates to people who don't bother to shop around.

Yes I agree with you....but surely putting up the interest rate will encourage me to look around more ?

I have the BA American Express card and use it to collect Avios points. Have been a customer for a few years and have spent quite heavily on it.

But as my initial post, increasing interest rate like this is crazy .

[Deleted User]

A lot of lenders are increasing rates to cover general costs, especially with the reduction in merchant fees. Don't take it personally.

Superscrooge

If you pay your balance in full each month, the interest rate doesn't make any difference as you don't pay interest

daveyjp

Superscrooge wrote: »

If you pay your balance in full each month, the interest rate doesn't make any difference as you don't pay interest

Exactly this. Get the card for what you get out of it, not what the provider does.

dazzaofdagenham

Deleted_User wrote: »

A lot of lenders are increasing rates to cover general costs, especially with the reduction in merchant fees. Don't take it personally.

But no movement in the Bank of England base rate....what's going on

dazzaofdagenham

daveyjp wrote: »

Exactly this. Get the card for what you get out of it, not what the provider does.

Yes of course, over the last year I've most probably had more out of them in there promotions than interest I've paid.

But the point I'm making is how can they increase the interest rate in this way when the Bank of England interest rate hasn't moved ?

Ok, I guess a answer is ' because they can and its in the T / C's ..

But for people who run high balances ? And for other cards, will they follow suit...

StopIt

dazzaofdagenham wrote: »

But no movement in the Bank of England base rate....what's going on

ZX81 literally answered your question.


Generally, more 0% deals means that the CC companies have to make money somewhere else. the BOE base rate is frankly a non factor in CC rate setting anyway, unlike the mortgage market for instance.


Anyway, only a mug pays interest on their CC. If you do you're doing it wrong. A "normal/rewards" CC that charges 15%+ is not a card to carry a balance on. Use rewards cards for rewards and a 0% card for balances, but frankly, if you're constantly adding to a balance and no paying it off you need to look at your finances because you're not living within your means.