Cost of carrying a credit card keeps getting higher - KOMO

The cost of carrying a credit card in your wallet keep getting higher. That's the overall conclusion of a new survey out today.The survey by Consumer Action, a California consumer group, looked at more than 80 cards from 20 banks, Including the 10 top credit card issuers.And here is some of what they found:Interest rates are up. The average interest rate for all the cards surveyed was 14.53 percent. That's up two percentage points from Consumer Action's 2005 survey.The average fixed rate card had a rate of 11.34 percent and the variable cards averaged 15.25 percent. It's clear that the higher prime rate is driving up credit card rates.The Consumer Action survey also found that penalty rates are up, especially the late fee. Make a late payment even one time, even by one day, and you can get hit with a large late fee -- and see your interest rate skyrocket.The average late fee is now $28, up from $13 back in 1995. But some banks charge a lot more. Consumer Action found late fees as high as $39 per incident.What about that penalty interest rate? The average is 24.51 percent. But with some credit card issuers, the penalty interest rate is 32.24 percent. And Consumer Action says there are lots of zero-percent interest balance transfer offers available now. These zero-percent deals can last from three to 12 months.Zero percent sounds like free money, but many banks now charge a transfer free to move your debt from another card to their card. That transfer fee can be as high as three percent. If you transfer a $10,000 balance you could pay as much as $300. So be sure to read the fine print before you take advantage of any zero balance transfer offer.The survey showed a continuing trend for card issuers to do away with annual fees. But many airline and high-end cards still have the fee, which the survey found are getting higher. If the bank wants to change something in your credit card agreement such as the interest rate or grace period, Federal law requires 15 days notice if the issuer is going to make a "material change" in the terms of the use. However, they are not required to give you any advance notice for the change is based on something you supposedly did wrong, such as paying late, going over your limit, or bouncing a check.

Nigeria: Skye Bank Releases Naira Credit Card

Frances OviaLagos

Skye Bank Plc has introduced a new credit card denominated in naira, into the banking industry for customers. The primary objective is to offer a differentiated card payment value propositions to the discerning target market that would address the specific needs of each market taking into cognizance its peculiarities. The scheme developed by e-Channels Group of the bank is targeted at customers and non-customers of the bank who have verifiable and regular sources of income.

The new product has two variants of Classic and Premium. The Skyecard credit Classic is targeted at the low income earners who form a sizable number of the bank's current customer base, it renders benefits derivable from carrying a debit card while Premium is targeted at a wide market, differentiated by income bracket and credit profile such as income, employment structure, credit history and so on. It provides both secured and unsecured finance for customers and non-customers of the bank. Mr. Adesola Akinfemiwa, Managing Director, Skye Bank who expressed delight at the acceptance rate and transaction volume of debit cards, which the bank has been a leading promoter in the banking industry, said the new credit card would be very useful to customers as it would save them stress of carrying cash around at the risk of armed robbery attack. He said the intention of the bank is to put the cards in the hands of people who want cash before their next pay day.

General Manager, Retail Banking, Skye Bank, Mr. Dotun Adeniyi, explained that the new credit card introduction is in furtherance of the bank's marke leadership in card business. "As we launch these two credit cards, those who buy into it will enjoy the good things that are happening here and we will continue to maintain market leadership," he said.

Mr. Chuma Ezirim, Assistant General Manager, e-Channels Group, Skye Bank said the card process comprising issuance, operations and management is fully automated and runs on a robust credit card management system and that credit scoring and assessment module makes it possible for applications to be processed on-the-spot while there are no restrictions on usage.






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He said the size of the market is very large but very challenging and this i formed the bank's reason taking its time to offer to the market a credit card scheme that runs on a well tested, best in class and robust credit card management system. He said the scheme is expected to receive the required support from the government and Central Bank as it will complement various federal government initiatives towards the promotion of customer credit policy as incorporated in the National Economic Empowerment Development Strategy (NEEDS).

Ezirim who explained the features of the credit card said it is an electronic local card payment scheme which will be used to avail credit lines to individuals that has interest fee period of up to 30 days, interest rate of 18 per cent per annum on utilized credit only, flexible limit-based on income of cardholder; free internet and mobile banking services; SMS alerts on all transactions and two years validity period for the card, among others.

"A large proportion of Nigerians need extra cash outside monthly income to meet personal financial commitments, which they cannot easily obtain from friends and family members, and would like to pay back inn a convenient manner. "Skyecard credit avails the average Nigerian this opportunity," he added.