Consumers at mercy of banks

DO you know how much your bank charges you in interest fees for services like your credit card? Chances are that, if you tried to find out, you would be unlikely to succeed.

The banks argue otherwise, but a telling exercise carried out this summer on behalf of a UK Treasury select committee tasked with unravelling the mystery of various financial service charges shows how incomprehensible many bank charges are to the average person.

APR (annual percentage rates) are supposed to make credit card fees understandable and comparable. Yet when the Treasury committee asked one prominent Cambridge mathematician to calculate the charges for one apparently simple credit card deal.