Credit card customers in the UK continue to be hit by the rising costs in increased fees and charges over the past two years, according to a recent report.

The report says that the hike in fees and charges has put a strain on financial management in many cash strapped households.

According to one industry official, the average purchase rate on a credit card has jumped from 14.9% in April 2006 to the latest figure of 16.4%.

Industry insiders believe that the current market turmoil has resulted in all borrowers paying the price as compared to a few years ago when only a select number of customers were being penalised.

Insiders argue that customers who pay their bills in full each month will not be affected by the rate increase however; many households struggling with increasing financial pressures who only repay the minimum will be hardest hit.

The average interest rate for cash transactions has seen a marked increase from 18.1% to 24.3% and in addition these, a majority of institutions have increased cash advance charges.

Market analysts believe that taking cash out on credit cards has always been an expensive way of borrowing, however, with the 6.2% increase in the average interest rate, customers who rely on cash advances to pay their bills, will find it an increasingly expensive venture.