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Competition Commission slams store cards
07/03/2006 15:21:00
A government watchdog is warning consumers they could be paying up to 20 per cent more interest on store cards than on regular credit cards.
The Competition Commission found that the average annual percentage rate (APR) on a store card was 26.5 per cent, which it claims is up to 20 per cent too high.
Christopher Clarke, deputy chairman of the Competition Commission, said: "Retailers and store card credit providers are, we have found, effectively insulated from competitive pressures.
"The consequence is that store cardholders who take up credit and associated insurance pay too much."
As a result of the high APRs, customers are paying some £55 million annually in unnecessary interest payments, claims the watchdog.
Customers are being urged to consider cheaper deals, other than store cards, to avoid slipping into debt.
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