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THE Supreme Court's decision to uphold the right of banks to continue charging high interest charges for unauthorised overdrafts places banks on a par with the unscrupulous loan and debt management companies, according to consumer privacy service, the Call Prevention Registry.
Last month, it reported that almost half of all unwanted calls made to British households during November came from loan and debt management companies, but that an increasing number of cashstrapped consumers are being tempted - regardless of the high interest rates quoted.
Paul MacKenzie-Cummins of CPR said: "We have been alarmed at the growing number of consumers who have contacted us since the Supreme Court's ruling and reported that they have seriously considered getting themselves into further debt by accepting one of the many high interest loans being offered, especially with most banks making it more difficult for borrowers to extend their credit via overdrafts or another form of loan.
"With Christmas so close and the expectation of a cold winter just around the corner, many consumers could struggle to cope with the cost of the festive period and rising energy bills and may be tempted to take up the offer of one of these high interest loans to 'get them through' a difficult couple of months ahead."
These latest findings follow the recent news that credit card firm Capital One has increased interest rates with some customers forced to pay almost 40% interest on their Christmas gifts unless they clear their balances in full. And the fear is that this will prompt other lenders to follow suit.
PricewaterhouseCoopers recently warned that banks are expected to impose higher interest rates and fees on millions of customers. And they suggest that the level of personal debt is likely to leap by 50% by Christmas 2010.
On the face of this it is quite an interesting piece of journalism. HOWEVER, let's dig a bit deeper....
Last month, it reported that almost half of all unwanted calls made to British households during November came from loan and debt management companies, but that an increasing number of cashstrapped consumers are being tempted - regardless of the high interest rates quoted.
Paul MacKenzie-Cummins of CPR said: "We have been alarmed at the growing number of consumers who have contacted us since the Supreme Court's ruling and reported that they have seriously considered getting themselves into further debt by accepting one of the many high interest loans being offered, especially with most banks making it more difficult for borrowers to extend their credit via overdrafts or another form of loan.
"With Christmas so close and the expectation of a cold winter just around the corner, many consumers could struggle to cope with the cost of the festive period and rising energy bills and may be tempted to take up the offer of one of these high interest loans to 'get them through' a difficult couple of months ahead."
These latest findings follow the recent news that credit card firm Capital One has increased interest rates with some customers forced to pay almost 40% interest on their Christmas gifts unless they clear their balances in full. And the fear is that this will prompt other lenders to follow suit.
PricewaterhouseCoopers recently warned that banks are expected to impose higher interest rates and fees on millions of customers. And they suggest that the level of personal debt is likely to leap by 50% by Christmas 2010.
On the face of this it is quite an interesting piece of journalism. HOWEVER, let's dig a bit deeper....
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