AMEX increases rates for late payers

Credit card giant American Express has recently announced that cardholders that make late repayments on their credit card, or those that miss repayments, will be penalised with higher interest rates.

This could result in cardholders having to pay far more in interest for missing or making late payments, and many people could be affected in the current climate where an increasing number of borrowers are falling behind on repayments from time to time.

Missing just one payment under the new rules could result in cardholders being charged significantly more in interest, and officials from the credit card giant have said that a variable rate of 19.9 percent could be increased to 23.9 percent for those that do miss payments or make late repayments.

Officials from the credit card firm have said that they do take steps to try and stop people from falling behind on repayments in the first place.

One customer, however, was angry that his interest rate had been increased because his otherwise perfect repayment record had not been taken into consideration by the financial giant. He said: ‘American Express said it was acting responsibly, but how can increasing interest rates for people struggling with their payments be seen as responsible?’

American Express has stated that whilst the interest rates will be put up for those that miss repayments or make late payments consumers can get the rate reduced again to the original rate, but this can only be done by closing the account, which mean that the borrower will be able to repay any existing balance at the original rate but will not be able to use any more credit.

Tags: Credit Cards, american express, payments, late payments, credit card charges, american express credit cards, interest rate, economics