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Nationwide credit card holders face more expensive bills from May after the building society announced today it is putting up interest rates on its cards by up to 2%.
People with a Nationwide Gold card will see their purchase rate increase from 15.9% annually to 16.9%, while the Classic card rate will increase from 17.9% to 19.9% from 6 May.
Anyone who uses a Nationwide debit or credit card outside Europe will also be charged a currency conversion fee imposed by Visa, which was previously absorbed by the building society. This will be £4.20 for every £500 spent.
The building society pointed out this was not the currency handling charge imposed by most credit card issuers, typically around 3%, which Nationwide still does not charge. Tens of thousands of Nationwide customers have taken out its cards to avoid this handling fee.
The building society said it was upping its interest rates to "bring it into line with the rest of the market".
However, the increase means Classic card holders will be paying above the average interest rate, which is 17.7% according to financial data service Moneyfacts.
Nationwide also risks incurring the wrath of more of its customers after a series of changes to its savings rates and mortgage terms.
The rates on its instant-access cash Isa and its e-saver account were both cut by more than the base rate cuts in December and now pay just 1% and 1.45% respectively. And last year it imposed a condition on its new tracker mortgage holders, which means their rates will not fall below 1% even if the base rate does. It has also shocked some customers by cutting the amount of credit available to them with immediate effect.
Nationwide is not the only card provider to increase interest rates in the face of a record-low base rate. The Bank of Scotland has increased rates on its Plus credit card by 1% to 16.9%, Citi has raised the rate on its Advantage Gold card from 17.4% to 18.9%, and Halifax has increased the rate on its Plus card by 1% to 16.9%.
Egg recently emailed its customers to tell them their rates are being raised by up to 5%, while Capital One announced it is to increase the rate on existing customers' credit cards by as much as 7% from April. By contrast, Barclaycard recently announced it will freeze interest rates on its cards for at least four months.
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