Millions of Halifax credit card customers could end up paying extra interest charges after being told they didn’t need to pay off as much each month.

Halifax, part of the HBOS group which is being bought by Lloyds TSB and has more than 4m customers, changed its terms and conditions last week to reduce the minimum monthly repayments on a credit card bill from 2% to 1%.

A consumer with the average balance of £1,384 will end up paying £3.23 more interest in the first year under the new minimum repayment terms — this increases to £51.39 on a balance of £10,000, according to the comparison firm Uswitch.

However if interest charges, insurance premiums and late payment charges, plus £5 is greater than the 1% minimum payment, customers will be obliged to pay the higher amount. It means that only those with bigger balances will be able to pay the new 1% minimum rate.

Halifax claims the changes will make it easier for those with big interest payments to tackle their bills. It says the majority of its customers will still repay an average of 2% each month.

Simeon Linstead of Uswitch said: “Making the minimum repayment 1% may seem like a good idea at the time, but it will barely touch the balance and could lead to a very long debt sentence.”