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Credit card shake up influences 2.5 million

Tue, 13 May 2008

Credit card providers have been out for blood, at least according to independent price comparison website uSwitch. uSwitch found that some 2.5 million UK credit card accounts faced fees, cut credit limits, or complete termination.

Providers are extra cautious of any credit risk, and with over 70 million credit cards in circulation many lenders are acting to reclaim bad debts . Of the millions of consumers caught up in this credit card shake-up, uSwitch report that just 16% missed more than one monthly repayment or exceeded their credit limit .

The Head of Personal Finance at uSwitch, Simeon Linstead, was reported as commenting: "We're not against credit cards providers curbing consumers' spending if their debts are genuinely getting out of hand. However, resorting to account closures, reducing credit limits and implementing annual or monthly fees without providing over 1 in 4 people with a reason for doing so is not good for consumer confidence or financial planning . Credit card companies who are taking action to close down or make changes to customers' accounts must be completely open about how and why they have selected those customers."
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