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Credit card interest rates must be cut.

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ROGER PRICE MP Federal Member for Chifley

Credit Card Interest Rates Must Be Cut

Banks must immediately pass on the Reserve Bank’s official interest rate cut of 0.25%, as well as previous interest rate cuts to credit card customers, Federal Member for Chifley Roger Price MP said today.

“In the last year banks have pocketed massive profits by not passing on interest rate reductions to their credit card customers”, Mr Price said.

Interest rates margins on credit cards, that is, the difference between interest rates and the official cash rate, have increased by up to 1.00% in the last year, resulting in windfall profits to the banks.

“Passing on the Reserve Bank’s interest rate cut, as well as previous interest rate cuts, will make a massive difference to Australian families this Christmas”, Mr Price said.

Consumers are struggling under a mountain of credit card debt.

Australians now owe $18.9 billion in credit card debt, an increase of almost 100% in the last three years.

“The Howard Government must not sit by and watch while Australian families suffer at the expense of the Banks”, Mr Price said.

“Professor Fels from the ACCC has admitted that he is powerless to act on credit card interest rates unless directed to by John Howard”, he added.

“Labor is calling on the Howard Government to immediately direct the ACCC to conduct an inquiry into the banks’ practice of withholding the savings from interest rate cuts to customers”, Mr Price concluded.

Ends 5 December 2001

Contact: Paul Sekhon on 9625 4344 or 0417 416 144