Question

While serving a member/owner she comments on the "exorbitant" rate of interest she is being charged on a bank credit card. She wonders if there is a official body to whom she can complain. What do you suggest and why?

Answer 1

A customer who finds credit card interest rates exorbitant can appeal to consumer protection agencies or financial ombudsmen. Usury laws may offer some limits, and the average interest rate is about 15%. Customers are advised to review their agreements and consider alternative financial products.

Step-by-step explanation:

If a member or owner of a bank account feels that the interest rates on their credit card are exorbitant, they can voice their concerns to official bodies designated for consumer protection. In the financial market, usury laws may set limits to the interest rates that can be charged, and individuals could seek assistance from consumer protection agencies or even the financial ombudsman service, dependent on their country's regulatory systems.

The average annual interest rate for credit card borrowing is typically 15%. While credit card companies argue that higher rates are required to cover losses from those who default on their payments, it can be a heavy burden for those who carry balances. Political pressures have occasionally led to calls for price ceilings in these markets.

Customers should carefully review their cardholder agreement and understand their rights. They can also look at alternatives in the market or consider different financial products that might offer more favorable terms.