Increase of credit card fees
A recent study published by moneyland.ch points out that most of credit card providers increased fees for Visa and Mastercard. Why such an increase? What cost for consumers? Explanation.
Decrease of interest rates
As a reminder, the maximum interest rate for loans and credit cards has decreased from July 2016. While the old maximum rate was 15%, it is now 10% for personal loans, and 12% for credit cards. This interest rate applies to all unpaid – or partially paid – credit card balance.
Compensate for losses linked to the new rate
For the credit cards providers, this new rate leads to a shortfall. The main of fees increase is to compensate for those losses. If each provider offers different ranges of products, a study by moneyland.ch shows that the following fees increased in a significant way:
- Invoicing costs: up to 1,50 and 2 CHF for each printed invoice.
- Exchange costs: which apply to each purchase in foreign currency.
- Withdrawal charges: which apply to each money withdrawal from a cash dispenser.
How to minimise costs
There are two solutions to minimise credit cards costs: limit fees and limit the interest paid. In order to lower the paid interest, you should avoid partial payments. If it is not possible to pay a full bill, and if you consider a repayment over a number of months, then you should also consider a debt consolidation loan. Indeed, this solution will allow you to pay less interest on the amount you owe.