NEW YORK (1010 WINS/WCBS 880) — With the holiday season just around the corner and retailers already preparing for the shopping season, New York Rep. Anthony Weiner released a new study Sunday warning shoppers of high interest rates on store credit cards.
WCBS 880’s Ginny Kosola reports
The congressman said the study that examined credit cards at 35 major New York City stores revealed that the average interest rate was 24 percent — around 9 percent higher than an average bank credit card rate.
“Consumers need to realize that while they might be getting some pretty good teaser deals…they’re also paying a lot in interest rates if they chose to use these store credit cards,” Weiner said.
According to the study, Radio Shack had the highest interest rate — 28.99 percent, while competitors Staples and Best Buy trailed only slightly with a 27.99 percent interest rate.
“There’s no doubt about it…these store credit cards are a new profit center for the stores and more and more are offering it,” Weiner said.
The study also highlighted so-called “teaser” deals, which include offers to pay no interest for a number of months. However, if the bill is not paid within an allocated time, many retailers offering the promotion retroactively apply the interest rate to the initial purchase irrespective of how much of the bill was paid.
“The most important message that consumers need to understand is just the same way they’d shop around for a product during this holiday season that’s on its way here, they should shop around carefully for the way they pay for those products,” Weiner said.