MSE News: Barclaycard's cutting minimum repayments – you could be in debt YEARS longer

th081

In the long term and for the  UK plc consumer who on average pays a lot of interest each month (and I know some of you do not but lots do) would a much higher minimum repayment not be better legislated i.e 10% of the outstanding monthly amount. Credit card usage would fall over time and people would budget better?

Yorkshire_Pud

Lloyds used to have a 1% minimum repayment, now it’s 2.5%.
Barclays used to be 2.5% now it’s more but going to be less at 1%. 

So Lloyds and Barclays are just swopping places.
I don’t remember an outcry about Lloyds 1% rate in the past which it was at for years.
Kind of scraping the barrel of conjuring up a fearful news story. 

It’s just banks doing the Hokey Cokey, you put your interest rate up, you put your interest rate down then swop it back later.

rgk1953

Interesting figures, none of which I’ve ever seen in comparison tables. Perhaps this should be highlighted when comparing “best deals” to stop people jumping into higher minimum payment deals ( or lower) without realising how much they actually pay each month?

JonVarnas

Personally, if you're in the financial position where you can only make minimum payments for a significant amount of time you'd be better off defaulting or even going insolvent. That's what I did: Got a DRO and within 3 years got access to credit again. Far better than paying interest for umpteen years.

jay1804

Has anyone not had there minimum payment cut... I've just had my most recent statement after the 22nd and its still on the previous: 

The highest of: - 3.75% of your balance OR - 2.5% of your balance plus interest OR - £5

It's not much of an issue for me as I pay in full every month, but if I ever wanted to utilise an 0% offer, a lower minimum payment would nice.

ussdave

jay1804 said:

Has anyone not had there minimum payment cut... I've just had my most recent statement after the 22nd and its still on the previous: 

The highest of: - 3.75% of your balance OR - 2.5% of your balance plus interest OR - £5

It's not much of an issue for me as I pay in full every month, but if I ever wanted to utilise an 0% offer, a lower minimum payment would nice.

I just had my statement and it's also not changed to 1%.  Very odd.  

Nasqueron

Mine is definitely 1%, odd indeed

Nebulous2

My statement is always around the 1st of the month, and it was 1%. I pay in full, so it really doesn't matter. 

zagfles

I've got 2 BCs, they've changed min payment to 1% on one of them but not the other! The one they haven't changed I have a balance transfer at 0% on.

But it was the same when they increased the min payment a year or two ago, from 2.25% to 3.25%, they didn't increase the min payment on the card with the BT but they did on the other. So the BT card still has min payment of 2.25% which has survived two changes. 

So maybe they don't change the min payment on cards with a BT offer on. 

tomxlisa

I’ve also just had my statement and my percentage hasn’t changed but I do have a purchase and balance transfer offer on it so maybe the reason why also.