NATIONAL IRISH Bank has raised the cost of both credit cards and personal loans, bucking prevailing downward trends in interest rates.
The bank, which says its rates are “constantly under review”, increased rates on credit card and loan products on May 6th.
The move came just before euro-zone interest rates were cut by the European Central Bank (ECB) to 1 per cent last week. Euro-zone rates have declined from 4.25 per cent since October last year.
Under the new rates, a standard MasterCard now carries an 11 per cent interest rate (typical APR, 11.6 per cent), up from 10 per cent.
Gold MasterCard customers have seen the applicable rate rise from 9.25 per cent to 10.25 per cent and Platinum customers face an increase from 8.75 per cent to 9.75 per cent in their next bill.
Meanwhile, personal loan customers have seen rates rising from 9.24 per cent (typical APR 9.65 per cent) to 10.9 per cent for variable loans between €1,000 and €50,000, with the APR also increasing on some fixed-rate loans. For fixed loans of between €10,000 and €50,000, the APR risen from 8.75 per cent to 10.5 per cent.
In a statement, NIB said “the bank’s rates remain competitive”.
The bank, which was one of a number of institutions not to pass on last week’s latest ECB rate cut to variable mortgage-rate customers, is not entirely alone in raising its rates on credit cards and loans this year.
Halifax increased its APR on credit cards from 10.9 per cent to 11.7 per cent in February, while loan rates increased at the start of April after a “sale”. The wider trend is, however, for falling or, more commonly, unchanged rates.
Ulster Bank cut its variable personal loan rate in April, while AIB has reduced credit card rates in some cases. Bank of Ireland and Permanent TSB have equally chosen not to increase rates.
