Credit card companies have responded to the Office of Fair Trading's cap on penalty with higher interest rates and charges for customers, research has shown.

However, despite these rises there has been an increase in the number of 0% introductory deals and the duration of these has increased, according to financial information group Moneyfacts.co.uk.

In April 2006 the OFT said default charges for people who missed or bounced a payment were too high and it called for them to be capped at £12.

But since then the average interest rate consumers are charged has increased from 14.9% to 16.4%.

Michelle Slade, analyst at Moneyfacts.co.uk, said someone with a credit card balance of £5,000 who repaid just 2.5% of their debt each month would pay an additional £755 in interest as a result of the 1.5% increase in rates.

Credit card firms have also increased the rates they charge for cash advances, hiking these from 18.1% to 24.3%.

On top of this the majority of institutions have increased the fee for using a credit card to get cash from 2% or a minimum of £2 to 3% and a minimum of £3.

In April 2006 just 58 cards offered 0% on purchases for up to 10 months, compared with 85 cards today, offering the rate for up to 12 months.

There has also been a rise in the number of cards offering 0% balance transfer deals, with these increasing from 82 two years ago to 99 now, while the length of the deals has improved from up to 12 months to up to 15 months.

But the group warned that despite the rise in the number of 0% deals available, the tighter lending criteria now being used by credit card companies meant only those with "perfect credit histories" would be able to take advantage of the longer offers.

It added that even then the interest-free limits would be much smaller than previously.

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