The average fee for transferring a balance to a 0 per cent credit card has risen

According to research from Moneyexpert.com the average fee for transferring a balance to a 0 per cent credit card has risen by 0.5 per cent to 2.67 per cent over the last year.

The Office of Fair Trading told credit card companies to limit their default charges to £12 from August 2006 and it seems that other charges and fees have slowly increased over the last 12 months to make up for this loss.

Smart customers who are managing their finances by moving debt to low or zero rate offers are being punished.

Sean Gardner, Chief Executive of MoneyExpert.com, said: “What goes down must go up seems to be the experience in the credit card industry.”

“Card firms have lost out since they were forced to cut so-called default charges so now customers are losing out as balance transfer fees increase.”

“Analysts talk about the so-called water bed effect – cuts in one area mean increases in another area.”

Chiltern’s Simon Duffy says “The increase in new charges seem to be a replacement for the older charges which have been limited by the Office of Fair Trading.”

“Continuously transferring your balance to a 0 per cent credit card will only help if you can afford to make monthly payments to reduce the outstanding balance.”

“If people have credit card debt that they’re struggling to repay they should consider the options available to them sooner rather than later.”

“At Chiltern we can negotiate with your creditors for you and aim to have any interest and charges frozen, reducing your debt into a single monthly payment that you really can afford, putting you back in control of your finances.”

Visit Chiltern.uk.com today for a free, no obligation quote.