Banks ignore RBA cuts to keep credit card rates high

AUSTRALIA'S largest banks might be happy to pass on savings on your home loan interest rates, but they are making up for it by hitting customers hard on their credit cards.

There is now a record gap between credit card interest rates and those set by the Reserve Bank as the major lenders decide not to pass on the savings.

None of the biggest banks have passed on the savings that should have come when the RBA cut rates to 1.75% a month ago.

According to Mozo -- a bank comparison website -- the lenders have kept their credit interest rates almost the same for the past five years.

That's while the Reserve Bank has cut interest rates by three percentage points, bringing rates to their lowest level in decades.

That means the banks are able to charge customers the same while paying less themselves.

Australian Bankers' Association chief executive Steve Munchenberg told Fairfax the market was competitive, and customers could do their own research to find the best deal.

"With around 190 different cards available, and comparison websites helping people find what is on offer, it has never been easier for consumers to shop around and find the right credit card for them," Mr Munchenberg said.



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