IKEA slashes store card interest rates by half
IKEA today announced a dramatic interest rate reduction for customers who use the IKEA store card. From 9th August, interest on new purchases will be charged at a rate of 12.9% APR. This compares with the current rate of
26.8%The move follows months of talks between IKEA UK and IKANO Financial Services, the company which operates the store card. The new rate will be one of the lowest store card rates on offer from any major brand retailer in the UK and also compares favourably with many ordinary credit cards on the market (see Editor's notes).
Most store cards charge well over 20% APR and some even charge more than 30% APR. This has drawn increasing criticism from industry observers, independent commentators and parliamentarians alike.
IKEA has been reviewing the arrangements in place for its store card since last year.
Peter Hogsted, country manager for IKEA UK, said: "I am delighted that after a period of talks with IKANO, the company which operates our store card, we have managed to secure a substantial rate reduction.
Customers expect and deserve the best possible value from IKEA. In general, we like to think we do a good job in delivering that value but there was clearly some room for improvement with regard to charges on our store card.
We hope our customers will think halving store card charges is another great idea from IKEA."