Page last updated at 00:07 GMT, Saturday, 20 February 2010

Credit card rates excessive says ex-government adviser

Credit card in machine
Credit card interest rates are at their highest level for many years

A former government advisor has called for an investigation into the profit margins of credit card companies.

Ros Altmann says credit card rates of around 18% are excessive and argues there could be a case for a regulator to oversee the rates they charge.

Credit card customers are now paying the highest interest rates for 12 years, according to financial information service Moneyfacts.

This is despite the fact that base rates are at an all-time low of 0.5%.

The card companies say rates are high because of the large number of people failing to pay their bills during the recession.

The government is currently examining some of the charging methods used by card companies, although there are no plans to look at the level of the rates they charge.

But Ros Altmann says credit card rates cannot be justified and is calling for an enquiry into how the market works.

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