Barclaycard to hike minimum payments in major credit card shake-up - MSE News

CRISPIANNE3

I remember when the min payment in the 1970's was 5 percent. 

badmemory

It is interesting that while interest rates generally are in freefall, whether loan or savings, the one interest rate that remains unchanged is the credit card.  I wonder what they would do if people stopped using them or always paid them off in full.  Bring back fees like they will do soon on current accounts?

MattMattMattUK

badmemory said:

It is interesting that while interest rates generally are in freefall, whether loan or savings, the one interest rate that remains unchanged is the credit card.  I wonder what they would do if people stopped using them or always paid them off in full.  Bring back fees like they will do soon on current accounts?

Why do people seem to expect everything to be free when it comes to banking? In most of Europe transaction fees are common, monthly fees are common, overdrafts are rare and credit card limits are substantially lower and borrowing far more restricted. 

A product or service has a cost, yet some people still seem to think that when it comes to banking that cost does not exist. Yes banks make a lot of money overall, but much of that is from investment arms and the margins on retail and personal banking are tiny.

dr_adidas01

MattMattMattUK said:

badmemory said:

It is interesting that while interest rates generally are in freefall, whether loan or savings, the one interest rate that remains unchanged is the credit card.  I wonder what they would do if people stopped using them or always paid them off in full.  Bring back fees like they will do soon on current accounts?

Why do people seem to expect everything to be free when it comes to banking? In most of Europe transaction fees are common, monthly fees are common, overdrafts are rare and credit card limits are substantially lower and borrowing far more restricted. 

A product or service has a cost, yet some people still seem to think that when it comes to banking that cost does not exist. Yes banks make a lot of money overall, but much of that is from investment arms and the margins on retail and personal banking are tiny.

Its because that's the way it's always been in the UK, UK consumers aren't used to having to pay transaction fees for everyday banking so they expect it to always be free.

Silvertabby

badmemory said:

It is interesting that while interest rates generally are in freefall, whether loan or savings, the one interest rate that remains unchanged is the credit card.  I wonder what they would do if people stopped using them or always paid them off in full.  Bring back fees like they will do soon on current accounts?

Many of us have always paid our credit card bills in full every month.  No point in having a cashback card otherwise.

phillw

badmemory said:

Bring back fees like they will do soon on current accounts?

Three of my current accounts already have a monthly fee, but the return is greater than the fee.
Some banks have never charged fees, so it would be hard for them to "bring back fees".
HSBC tested the water with a press release, but I'm not convinced they will go ahead.

phillw

Silvertabby said:
Many of us have always paid our credit card bills in full every month. 

Unless it's on 0% of course. With interests rates so low, they probably are still making money out of 0% credit cards. If they could guarantee that they'd get the money back eventually then I reckon we'd see way more 0% deals.

DiamondLil

dr_adidas01 said:

Its because that's the way it's always been in the UK, UK consumers aren't used to having to pay transaction fees for everyday banking so they expect it to always be free.

It hasn't always been this way in the UK. I well remember discovering and opening a current account with the Trustee Savings Bank because they didn't charge a fee. My previous banks had all charged.

MattMattMattUK

phillw said:
If they could guarantee that they'd get the money back eventually then I reckon we'd see way more 0% deals.

The issue is always with defaults, it is why payday loans had very high interest rates and still only made a net profit of around 1.5%.

If people always repaid their debts life would be simpler and banking cheaper, if people did not shoplift then items sold in shops would be cheaper, if people did not claim items had not been delivered when ordering online then online orders could be cheaper, etc. The cost of people's dishonesty is built into the business models, they account for it in overall costs, but that pushes the prices up for those of us who are honest. Shoplifting and online order delivery theft costs UK retailers about £6.9, billion per year, or roughly £133 per adult per year. Fraud costs around £130 billion, but that is harder to split out as some of it affects, individuals, businesses, HMRC etc. but the nominal cost would be £2,500 per adult per year. 

badmemory

DiamondLil said:

It hasn't always been this way in the UK. I well remember discovering and opening a current account with the Trustee Savings Bank because they didn't charge a fee. My previous banks had all charged.

But it has been like that for over 30 years, which means that most people on here won't remember as they will be too young.  I don't know about you but I would rather not go back to withdrawing cash & trekking round the gas board, electricity board, rates etc.  That is always supposing you even had a bank account.