Irish paying more on cards, but less on mortgages
Irish households are paying more interest on their credit cards and overdrafts than most of their European counterparts, but less on their mortgages, new figures show.
Data from the Central Bank has revealed that, on average, Irish consumers are forking out 8pc more than other shoppers in the eurozone on their interest bills for short-term credit, typically taking the form of credit cards and overdrafts.
The numbers show that hard-pressed Irish consumers are paying an average interest rate of 8.64pc on their credit cards and overdrafts. That's slightly lower than the previous month, but still higher than the 7.97pc average that's being levied on consumers in other eurozone nations.
Mortgages cost less here, however, than in other eurozone countries -- but that's only because so many homeowners are fortunate enough to be on low-cost tracker mortgages.
Average mortgage interest rates in Ireland stood at 3pc at the end of April. That was slightly higher than in March, but still 0.42pc lower than at the end of September last year. In other euro countries, the rate is 3.8pc on average.
Tracker mortgages are linked to the interest rate set by the ECB, which is at a historically low 1pc. That rate could even dip lower next month as policymakers fight to haul Europe out of its economic quagmire.
About one-third of residential mortgages in Ireland are trackers.
Finance expert Bob Quinn, the managing director of moneyadviser.ie, said that the tracker rates being paid greatly distort the figures from the Central Bank and don't reflect the true weight of the mortgage repayment burden endured by many homeowners.
Mr Quinn also said that Irish consumers still aren't complaining enough about high bank charges and need to be more proactive in moving their business. But he conceded that competition in the sector has virtually evaporated.
"We won't see proper competition again in the Irish banking sector for many, many years," he said.