Store cards should be subject to tougher regulations, the shadow chancellor has said.
Store cards charging excessive repayment rates to customers have been attacked by the shadow chancellor.
George Osbourne said that the Office of Fair Trading should be given the power to fine companies who offer cardholders poor value for money by charging interest in excess of 25 per cent. He also claimed that Britons were "addicted to debt", with usage of store cards contributing to that problem.
A new national advice service should also be launched to provide free guidance on personal finance issues in order to tackle the problem, Mr Osbourne said.
Figures released by the Conservative party show that, collectively, £2.2 billion is currently owed on store cards in the UK; the number of store card accounts held is also claimed to have increased from seven million to over 13 million since 2003.
Commenting on the research, Mr Osbourne said: "We're addicted to debt, and we are seeing the consequences of that as the credit crunch hits, and everyone is finding it more and more difficult with the rising cost of living. I'm not telling people whether they should take out a store card, I'm just setting out the boundaries to ensure fair play. We all have to pick up the pieces when people get out of control with their debts."
He added: "We need to take steps now to deal with the current [debt] problem and make sure that in future we don't repeat the mistake and let Britain become hooked on debt."
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