Credit card with 69.9% interest

The card is being offered to people with "modest" incomes

People with poor credit histories are being offered credit cards with interest charges of up to 69.9%.

Card provider Vanquis, part of Provident Financial, is marketing the cards "for people on moderate incomes".

It said people should not be excluded from using a credit card because of past debt problems.

There is increasing concern about the proliferation of easy credit and the level of UK indebtedness, which broke the £1 trillion barrier in July 2004.

Small amounts

Provident Financial is the UK's biggest doorstep lender and targets people who have been turned down by mainstream lenders.

David Stevenson, a spokesman for the company, defended its decision to market the cards.

People should look at the rates in competition to other interest rates that are available elsewhere Mike Naylor, Which?

"Our cards are for people who may have had problems in the past or those on modest incomes and therefore we have to price based on the risk involved," he said.

He said people would usually be permitted to borrow small amounts of money, such as £150 or £200.

The rate of interest would be reviewed each year, with the chance of it being cut if customers stick to repayments.

"Credit cards are a fact of life and we don't believe people should be excluded from having one. We treat customers as grown-ups," Mr Stevenson said.

Shop around

Mike Naylor, principal researcher at Which?, said that some people who believed they had a poor credit history may be surprised by mainstream lenders' attitudes.

"People should look at the rates in competition to other interest rates that are available elsewhere," he said.

"Part of me says that even the less well-off, which is who this card will targeted at, should be entitled to have a credit card," said Frances Walker, a spokesperson for the Consumer Credit Counselling Service.

However, she said people would still have to be "very sensible".

"The annual percentage rate (interest) is high and we would advise people not just to pay back the minimum amount."