TENS of thousands of bank customers have been hit with a crippling interest rate hike on their credit cards -- just days before Christmas.
The increase of up to 4pc on Bank of Ireland credit cards will heap more debt on shoppers who have already stretched themselves on festive spending.
The bank has been accused of cashing in at the worst time of the year -- when many shoppers are using credit cards because they are short of cash.
The interest charged on a range of cards from the bank was increased by up to 4pc with effect from yesterday, exactly a week before Christmas Day.
The rates have gone up by between 0.7pc and 4pc.
The bank, which got ¿4.7bn in a bailout from the taxpayer, said it had not raised rates since August 2011.
The hikes come ahead of peak spending days for consumers preparing for the festive season.
Finance expert Simon Moynihan, of price comparison site Bonkers.ie, accused the bank of squeezing shoppers at a time when they are most vulnerable.
"The bank knows people will blow a chunk of cash at Christmas and hope to be able to pay it back in January.
"But few will be able to clear the debt in January. It seems to be a way for the bank to make a few extra quid."
A recent credit union survey found it can take some people up to six months to recover from overspending at Christmas.
The largest hike in Bank of Ireland credit card rates was for the Clear card, with the rate for purchases jumping from 13.8pc to 17.8pc.
People with Platinum cards will jump from 16.6pc to 17.3pc for purchases on the card. The rate on the Classic card goes up 2pc to 19.9pc.
Bank of Ireland is one of the largest operators of credit cards in the country.
A spokeswoman for the bank said: "With continued pressure from high funding costs and the continuing high risk and loss profiles, these changes were considered necessary to sustain product investment.
"The bank continues to offer very competitive rates across our full range of credit card products in Ireland."
However, chief executive of the Consumers' Association of Ireland Dermott Jewell accused the bank of making a "determined calculation to take advantage of people".
"They are going to make a significant amount of money in interest and it comes across as calculated.
"It's a terrible time to introduce increases in credit card interest rates. There is an argument there's never a good time – but there is, and this isn't it.
"Many, many people – and it's acknowledged by every financial house – are in debt and a significant number of people must use their credit card just to exist," he added.
He said many credit card users do not have the money to clear their bill at the end of the month and are in a spiral of debt as they only meet the minimum repayment.
"For years the Consumers' Association of Ireland has been looking for some element of change in approach; the minimum monthly repayment is still too low. All it does is maintain a consumer in debt.
"It's not going to sit well for consumers but there is very little they can do as there's no competition in the market."
Mr Jewell said consumers should arm themselves with as much information as possible and find out exactly what interest rate they are being charged.
"The reality of life is that a lot of consumers need to think about what they are purchasing and is it worth all the interest that's added to it. You could buy something for €40, but it ends up costing €55. Is it worth it?"
Earlier this year, Bank of Ireland and its subsidiary ICS hiked the variable rates for existing residential and buy-to-let mortgage holders by 0.5pc.
And last month more than a million customers of the bank were hit with a new fee structure for current accounts.
Anyone who fails to keep €3,000 in their account at all times will be hit with a slew of fees and charges. Consumer groups said very few people could afford to do this.
The bank is also reducing services at more than 40 branches. Counter cash services will only be available on certain days of the week.