As shoppers face a grim Christmas with belt tightening the order of the day and unemployment looming like the ghost of Christmas past, those who buy their presents on credit cards face a big hike in interest charges.

Banks have increased interest rates for tens of millions of credit cardholders despite bank base rate, now at just 3%, falling to a 50-year low. A study of 240 cards by analyst Defaqto shows that the average annual interest charge on credit cards has climbed from 17.2% to 17.6% since May – at a time when interest rates have been falling.

Over that period NatWest’s credit card charge has risen from 13.9% to 16.9% while HSBC’s credit card and the Virgin Money Mastercard have both increased rates by 1%.

Apacs, the banks’ payment association, which also represents credit card providers, said banks do not set card rates according to bank base rate and that interest charges also cover administrative costs.

David Black of Defaqto said that credit card companies are probably attempting to recoup the cost of bad debts, rising levels of fraud and customers making use of 0% balance transfer discounts.

The interest rate hikes have annoyed the Prime Minister, who called for a ‘new responsible approach to lending’, revealing that he was planning a Downing Street summit to discuss the matter with the credit card firms.

In a statement that indicates how the banks – particularly those, like HBOS, Lloyds TSB and RBS, that face partial nationalisation – will be subject to government pressure, Gordon Brown said, ‘I think we have got to bring the credit card industry in to talk to them to join with us in establishing clear principles to apply to the costs people face on their existing debts.’

Store cards are the worst offenders with many commonly charging 25% or more to those who use the credit facility. High Street chain shops Principles, Karen Millen and Oasis have been highlighted in Defaqto’s study for raising its charges even higher to 28.9%.