The British public are addicted to debt, according to shadow chancellor George Osborne. After Fool.co.uk declared that high interest rates on store cards means that they are “the devil in disguise”, the Conservative Party have pledged to help British consumers who are feeling the pressure of debt due to the lingering credit crunch.
The Conservatives claim that around £2.2 billion pounds worth of debt is owed on store cards alone, and the number of store card accounts has doubled to approximately 13.4 million in recent years.
If they come into power at the next general election, they vow to introduce a cooling-off period so that consumers cannot start using their store cards the moment that they have been approved. Furthermore, they plan to give additional power to the Office of Fair Trading to ensure that store card providers cannot charge any more than a 25% interest rate, as some store cards are currently charging as much as 29.9% APR.
George Osborne told GMTV that: “We’ve got a big problem in Britain, we’re addicted to debt and we are seeing the consequences of that as the credit crunch hits, and everyone is finding it more and more difficult with the rising cost of living.”