Northern Ireland consumers using Northern Bank credit cards may be paying the highest interest charges applying anywhere on the UK credit card market – an astonishing 100 times the base rate set by the Bank of England.
According to analysis from Moneyfacts, Northern Bank charges 48.9% interest on its Platinum Mastercard. This gives it the very dubious distinction of being the most expensive credit card currently available on the UK market.
Only one other credit card – the British Airways American Express Premium Plus, Amex, which is designed primarily as a charge card – has an interest rate of over 40%. A further six credit cards have interest rates of over 30%, issued by Vanquis, Virgin Money (on its Atlantic Black Amex), Aqua, two Capital One cards and the MBNA Travel American Express card.
In total there are just 11 cards shown by Moneyfacts as charging over 20%. This is at a time when Bank of England base rates are at an historic low of a mere 0.5%.
Figures released last year by the Credit Action charity estimated that total credit card debt in Northern Ireland now exceeds £1bn, or £1,600 per household. UK Payments Administration, which compiles statistics on UK credit card use, does not put together figures on credit card use in Northern Ireland, unlike all other UK regions.
Julie McCurley, Head of Money Affairs at the Consumer Council of Northern Ireland said: “Consumer Council research shows that fewer consumers in Northern Ireland pay off the full balance on their credit card now compared to 2004. Only 34 per cent of consumers with a credit card pay off the full balance each month compared to 48 per cent in 2004; 17 per cent now make the minimum payment compared to 11 per cent in 2004.
“With many consumers in Northern Ireland saying that they are worried about being able to make ends meet, there is a great risk that many will turn to credit cards without realising how much it will cost to borrow this way. ”
Northern Bank was not able to provide a response in the time available.