Barclaycard, the UK's biggest credit card provider, has been accused of keeping its customers in “perpetual debt” by lowering the minimum repayment on credit cards.

From next month the minimum repayment for a portion of customers will be lowered from 2.25 per cent to 1.5 per cent. But consumers groups have warned that the move could add thousands of pounds to borrowers’ interest charges, meaning it will take many more years to repay the debt.

A cardholder with £5,000 at an interest rate of 15.9 per cent, making the current minimum repayment, will take 31 years to repay the debt with interest charges of £5,900.

At the new minimum repayment, the debt will take 98 years to repay with interest charges of £22,300.

Barclaycard’s announcement came as new research shows 0 per cent balance transfer deals have all but disappeared for most borrowers – meaning most people are forced to stay on cards charging high rates of interest.

Almost 2 million consumers have been rejected for balance transfer deals in the last year, representing 57 per cent of all credit card rejections, according to uSwitch.com, the comparison website.

In total, £3.5 billion of credit card debt is now stuck on interest bearing credit cards as consumers cannot switch to their next 0 per cent deal.

Millions of consumers are currently struggling with credit card debt as the recession takes its toll on household finances. But if borrowers only make minimum repayments on credit cards, their debt problems will become much worse in the long-term.

Martin Lewis of moneysavingexpert.com, a personal finance website, says: "Minimum repayments are sheer genius for card companies as they get to look generous by 'cutting costs' when they're actually keeping customers perpetually in debt.

“As the amount you owe reduces, so does the amount you repay, meaning most people are barely covering the interest that accrues, and hardly eating into the amount owed at all.”

A Barclaycard spokesman said: "We are doing this to help customers. This is an option we are giving to selected customers for them to be able to make a reduced minimum repayment for a limited period if the customer chooses to do so. We understand that some customers may appreciate this additional flexibility during the current economic circumstances.

"We have written to the customers selected and been very clear about the dangers of only ever making their minimum repayment and that it is always best for the customer to repay as much as they can.

"As always, customers can pay any amount over the minimum repayment and can choose to return to their existing minimum repayment by giving us a call when they get the letter."