Bad credit card practices our own doing, expert says

It is our own fault that there are bad credit card practices, one expert has said.

Credit card practices which are designed to "slug us" are our own fault, according to one industry expert.

Nicole Pedersen-McKinnon, writing for Business Day, said having to pay interest on top of interest and paying a mortgage interest rate at ten per cent is also down to us.

And some industry pundits believe the official cash rate will increase up to 7.25 per cent – a high in 2008 – by 2012.

"But a mortgage margin that's now almost three percentage points means we'll pay more than ten per cent," Ms Pedersen-McKinnon added.

"This is a level not reached since 1996, before the entrance of foreign institutions forced the local guys to get competitive."

But charging interest on top of interest is not just limited to Westpac – which offers a range of credit cards – the expert noted.

Earlier this month, the Reserve Bank of Australia increased the official rate by 0.25 per cent to 4.25 per cent.

By Emma North