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If at the moment you are living in Great Britain you will be experiencing a massive credit crunch, House prices are rocketing sky high and inflation is appalling. Last week I went into a shop and spent 90 pence ( about $1.3 ) on some food and a week later I go back in only to spend 1.04 on the exact same items. So the economy is obviously not at this moment stable. One of the main causes of this is due to the massive amounts of cash we owe on credit cards. The reason why so many people owe so much money on there cards is because they are sucked in by the companies who lend money with offers of 1 years interest free ect, so for the first year you feel free to use the card. This becomes habit and 2 years later you realise you no longer have any money left on the card and you owe 7,000 pound on a card that originally only had a 2,000 pound limit. Interest rates then shoot up from %0 to %4 in just a year and your stuck paying back a ridiculous amount of money that you cannot possibly pay back. This leads to great stress and a lifestyle you wanted to avoid by getting a %0 interest card. See how you were sucked into believing they were doing what's best for you. Card companies only really care about their own interests and are just trying to squeeze as much money out of you as they can.

If the credit card industry was government regulated then it would help people to avoid falling into these traps. The government has the authority to regulate the interest rates so the interest rates wont be crippling families allowing them to pay the cards off easier. This will help them pay for more goods, therefore helping the economy to remain stable. People don't have the self control to only use cards on goods they need at that moment that they don't have the money for. If credit cards were only used to buy a new washing machine when it broke or new shoes for your child when he gets holes in them a week before pay day then the economy would be more stable, but cards are used in gambling sites, in shops to buy things you fancy such as a new phone and a new computer knowing that you cant afford it but feeling safe that you can pay it off over a few years. However the truth is that everybody is using their cards like that which is making the economy more unstable forcing interest rates up. If the industry was government regulated they could control credit card limits and ban credit card use on gambling sites.

Often people are given cards with limits way above what they can afford. When they cant afford the repayments they have to take out loans ect just to pay off other debts. This puts people into more debt meaning that they struggle to pay off everything the owe. If it was government regulated they could set limits that people can actually pay off, I know somebody who earns 40,000 GBP a year and has a card for 20,000 GBP that's half of his wages he needs to repay to a card and with a %4 interest rate per month that works out with him paying huge amounts of money that he simply cannot afford along with his mortgage and his car insurance, then living costs so he can barley afford it. If it was government regulated he would only have a card with a maximum 10,000 GBP limit

Although people should have as much freedom as possible without the government interfering we are simply not responsible enough as a nation to spend reasonable amounts of money and to use credit cards, so government regulation ( not interference ) will be better for us all

Learn more about this author, Benjamin Jeans.
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