Credit card profits must be investigated

Published: 8:00AM GMT 20 Feb 2010

Ros Altmann, who has advised the Number 10 Policy Unit on pensions and has acted as a consultant to the Treasury, warned that credit card rates of around 18% are excessive.

She believes there could be a case for a regulator to oversee the rates they charge.

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Credit card customers are now paying the highest interest rates for 12 years despite the fact that base rates are at an all-time low of 0.5%.

The card companies say rates are high because of the large number of people failing to pay their bills during the recession.

The government is currently examining some of the charging methods used by card companies, although there are no plans to look at the level of the rates they charge.

But Ros Altmann says credit card rates cannot be justified and is calling for an inquiry into how the market works.