Financial well-being experts are warning people of the risks of high-interest store credit cards as more and more people fall into a cycle of debt.
And it comes as two popular cards increased their rates even further.
The team at Good Shepherd helps get people out of debt. But they're finding the high interest rates of finance or store credit cards are forcing more people to ask for help.
"We have cases with people that come to us, they are relying on very low income. We only work with low-income New Zealanders and they've got $4000, $5000, $6000 of debt on one of these store cards and it's just not manageable. Their budgets are in deficit every week," said Natalie Vincent, from Good Shepherd NZ.
On Thursday the Q Mastercard standard interest rate jumped almost 1 percent to 28.5 percent per annum.
The Farmers Mastercard is increasing its rates by 3 percent - to 28.5 percent as well.
"That seems incredibly high and we would question whether that's actually a fair move," Vincent said.
The new rates are nearly three times higher than bank credit card rates.
The company behind both cards has told customers it's been absorbing costs for some time so has to raise the rates to keep providing the same features and benefits.
But Vincent is worried the most vulnerable people are being targeted.
"They're getting sold these credits that are unsuitable and not fair," she said.
Consumer NZ says people are often hooked in by offers like six months interest-free.
"Some shoppers will be turning to these cards as a last resort to be able to purchase an essential item like washing machine or heater and are getting trapped in a cycle of debt," said Gemma Rasmussen, head of research and advocacy at Consumer.
The watchdog is advising people to be cautious and check what it'll really cost once the interest-free period ends.
"Actually calculate that, figure out if you can pay it - but also consider what your other options are," Rasmussen said.
Because in a cost-of-living crisis - extra debt is an added burden.
