Egg on customers faces

Lots of people have got used to living on credit in recent years, encouraged partly by relatively low interest rates. It's been easy to think "Oh I'll have that today and pay for it tommorrow". Things are changing though, triggered in part by the sub-prime problems in the US. The result has been problems with Banks reporting major losses and in the case of Northern Rock the near collapse of the bank.

There has been a lot of talk about a "Credit Crunch" but apart from the Northern Rock problems the crisis hasnt hit your average consumer.

There was news at the end of this week though that the online bank Egg has written to 161,000 of its credit card customers giving them 35 days notice that their credit card accounts will be closed. If any of these people have been juggling their money and relying on heir Egg credit cards to do this then this is going to be a severe blow.

Egg seems to have done this following a review of the risk on these accounts. If this is the case then it may not be easy for these people to get other credit card aprovals to replace the loss of their Egg credit cards.

I wonder what further ripples of this crisis we will see in the coming months. My guess is that we are going to see a lot more people having credit and debt problems before this is all over. The debt consolidation industry may well be the only one to benefit out of all this.