Morgan Stanley introduce £20 fee for 'a selection' of Black card customers

With the end of fee-free credit cards looming, Morgan Stanley has followed the growing number of credit card providers to introduce fees by announcing a £20 annual fee for ‘a selection’ of Black card customers from 1st June.

Mike Naylor, Personal Finance Expert at independent price comparison and switching service uSwitch.com, comments: “Morgan Stanley is the most recent credit card provider to follow the trend of charging customers a monthly or annual fee for a standard card. The £20 charge will impact ‘a selection’ of Black credit card customers from 1st June, but the rationale for selecting these customers is not entirely clear. The Black card is typically offered to customers who are rejected for the Platinum card, and while both have similar rates of interest and cash-back facilities, the former offers a much lower credit limit.

“The move to introduce fees by Morgan Stanley follows that of Co-operative Platinum Visa and Northern Rock Base Rate Visa earlier in the year. Both of these cards will now charge customers £2 per month (or £24 a year).

“More ‘innovatively’, as we reported last month, Lloyds TSB has introduced a one-off £35 annual fee for customers that do not use their credit card regularly, generating an income of £1.79 million in the one month alone. MBNA, which manage the Virgin card, has written to all customers that have both a positive credit card balance and an account that has been inactive for over a year. These customers can either claim the cash back, give it to charity or face a one-off debit from the positive balance of up to £10.

“We are seeing an increasing number of leading credit card providers bringing in monthly or annual fees, which is of little surprise given that many are trying to find new ways to recover the £300 million of profits lost as a result of the OFT’s clampdown on default charges just over a year ago.

“We would not be surprised to see more credit card providers move to introduce fees, in particular monthly or annual fees, before the end of this year. As such, consumers should continue to keep a close eye on the small print and the correspondence they receive from their provider, and seriously think about switching away from those that do introduce fees for no added benefit.”