Credit Card News

OFT publishes credit card comparisons report

Monday, 7th April 2008

The Office of Fair Trading (OFT) has published its report into credit card comparisons, which makes a series of recommendations to help consumers choose a credit card. The report is available to view or download on the OFT website, www.oft.gov.uk.

A result of a complaint last April from Which? highlighting that consumers choose credit cards without understanding all the issues that affect the cost of the card. Backed up by OFT research showing that 70% of credit card holders didn't shop around meaning they could be placing themselves at a financial disadvantage.

The report involved looking at issues surrounding the costs of using different credit cards including; cash advances, introductory offers and payment allocation. The report also worked with the credit card industry, consumer groups, other regulators, government bodies and other key stakeholders.

The main recommendations of the report are:
1- The introduction of an independent credit card price comparison website run by the FSA (Financial Services Authority).
2- Improvement to how information is presented in credit card issuers' summary boxes.
3- Standardisation of terminology used by credit card issuers in their product literature, and
4- Improvements to consumer education about the benefits of shopping around for a credit card.

The OFT says it will work with the card industry to implement the improvements to summary boxes, standardisation of terminology and education campaign.