Lawmakers in the U.K. are considering an overhaul of its credit card industry that would include policies like the ones that went into effect last month in the U.S.
The government is set to announce efforts to help protect consumers from high interest rates and "poor practices" in consumer finance, particularly from credit and store cards, prime minister Gordon Brown said in his weekly podcast Sunday. "One of the challenges we are confronting in the wake of the financial crisis is the behavior of some banks and credit card companies towards you, their customers."
The consumer protection measure will include forcing lenders to use money paid back from a customer to pay down that borrower's most expensive loans. That way, when customers take out multiple loans, the one charging the highest interest rate would be paid down first. Brown said it also would be harder for credit card companies to raise a customer's rates or lower credit limits without the customer's permission.
