The FBAA is standing behind the mounting calls for banks to lower exorbitant credit card interest rates, and welcomes the Federal Government probe into why credit card interest rates remain alarmingly high despite an historically low cash rate.
Four years after the FBAA first made a submission to the Senate about an inquiry into card rates, APRA has finally backed the call for the banks to scrutinised.
FBAA CEO Peter White
says it’s better late than never that the regulator has weighed into the debate, which now sees the current spread between official cash rates and rates charged on credit cards at record levels.
“The FBAA first made submissions to the Senate in 2011 and have since mounted an ongoing campaign. Now with cash rates at 2% and credit card rates hovering around 18%, it’s time to act.
“I applaud APRA’s move this week to stand in line with key officials, including Treasury, the Reserve Bank and even the Australian Securities and Investments Commission. They all want to see something done.”
White says it’s an obvious question that gets asked when his members sit down to talk with a client, who are constantly hearing about the Reserve Bank slashing rates to record lows.
“Here’s food for thought. Had the average credit card rate fallen in line with the RBA
’s cuts, our collective interest bill would be 900 million dollars a year lower.”