Consumers try to avoid High Street debt

In the current difficult climate there are many people that are looking for ways to cut back on their outgoings. For many this has meant cutting back on their spending and reducing their debt levels. His desperation to avoid debt was reflected in recent figures that showed there had been a drop in High Street store card borrowing and High Street finance for the month of November.

November is normally a busy time when it comes to spending on store cards and store finance, as many people are purchasing gifts for their loved ones for Christmas. Whilst in the past people may have signed up for store cards or taken out store finance to purchases these goods, a shift in attitude brought about by the challenging financial climate has resulted in fewer people spending on store cards or taking out store finance to make purchases.

Figures have shown that during the month of November last year the level of lending on store cards plummeted by 25 percent compared to the same period in the previous year. Just £202 was advanced on store cards during the month. Instore instalment finance levels also fell, with an 11 percent drop in the level of store finance compared to the same period a year earlier.

However, whilst store borrowing definitely took a big hit in the month of November there was an increase in the number of personal loans that were taken out by consumers. The figures were released by the Finance and Leasing Association, and showed that borrowing through personal loans increased by around 34 percent over the course of the month.

The report also showed that the largest source of advances was credit cards, which came as no surprise to most people. Whilst credit card lending for November remained was flat in November year in year it was still the source of £2.71 billion worth of lending.

Tags: financial climate, card, drop, christmas, consumers, Unsecured debt, shift, period

Tips for Spending Less on Your Holidays

Everyone needs to take a holiday at least once a year so that they can de-stress and unwind so that they will be rejuvenated and ready to return to work. Read more

Tags: cheap holidays, holidays, money saving ideas, local currency, restaurant, save money, repayment, card

Government bans credit card cheques

The government has recently updated credit card regulations and put a ban on credit card cheques being sent out to consumers by credit card companies. Read more

Tags: beginning, cash transaction, Revenue, cheque, industry officials

Lower income consumers can apply for many credit cards

It has recently been revealed that despite the tighter credit conditions that have come into play since the onset of the global credit crunch many consumers who are on relatively low wages are still eligible to apply for the majority of credit cards that are available on the market. Read more

Tags: debt, low income families, card, determining eligibility, interest, big fuss, labour credit cards, Credit Cards

Debit card spending overtook credit card spending last year

Recently released figures have shown that UK consumers spent more on their debit cards last year than on their credit cards, indicating that many are becoming more cautious about getting into debt in the current financial climate. Read more

Tags: Payment systems, processing, credit card spending, card, Debit cards

Borrowers could get help from credit card firms

According to recent reports some consumers could get assistance from credit card companies if they are struggling with their credit card debt, as part of a package of proposed measures resulting from recent meetings between officials from the credit card industry and senior government officials. Concerns were raised about the situation in the credit card industry when reports showed that whilst the base rate had been plummeting over recent months credit card interest rates were still very high. Read more

Tags: card, Minister Gareth Thomas, situation, government officials, deal, credit card help, Credit history, rate

Payday loans becoming more popular what hard up borrowers

In the past many people that were hard up and needed to raise some extra cash opted for a credit card or a loan. However, for many consumers these lines have credit have dried up over recent months, with the global credit crunch resulting in far tighter credit conditions that have left many would be borrowers out in the cold. This means that many have had to seek other ways of raising money, and this is reflected in figures that show an increase in the take up of payday loans. Read more

Tags: tighter credit conditions, doorstep lenders, limit, doorstep, payday loans

Holidaymakers incur charges by using plastic abroad

Holidaymakers are being warned that using debit and credit cards abroad could prove costly due to the charges implemented by providers.

Moneyfacts claims that the majority of travellers opt to use their plastic overseas as travellers cheques are seen as old fashioned, but added that these individuals need to be aware of hidden charges.

The site claims that some credit card providers charge up to three per cent for both purchases and cash transactions when using the card in a foreign country.

“This charge is applied each time the card is used and can soon mount up to a significant amount,” states a spokesperson for the site.

Methods for minimising the effects of these costs include taking out cash in larger lump sums to avoid a number of payments.

“Customers could find their balance much lower than expected when they get home if they are not careful”, concluded the spokesperson.

Meanwhile, in related news, the Association of Independent Tour Operators recently stated that do-it-yourself holidays are often a false economy as booking in this manner can mean that people are not covered by insurance.

Tags: independent tour operators, Insurance, travellers cheques, card, lump sums, balance, Business Finance

Surfers worry about using credit cards online

Almost half of UK internet users have reservations about using their credit cards to make purchases online, with a third feeling concerned about the security of web banking, according to new research.

Internet security firm F-Secure has found that 48 per cent of people are not confident that their card is secure when using it online.

Banking Trojans are rising sharply and can compromise security by stealing log-in details such as usernames and passwords by providing links to websites that are very close imitations of the genuine bank site.

Increasingly complex attacks are also emerging, says the company.

“Consumers need to be aware of threats when banking online, but that is not to say that they should not do it,” says Mikko Hyppönen, chief research officer at F-Secure.

In a recent survey, Abbey found that around 40 per cent of online shoppers want banks to monitor online transactions more closely to make the internet safer.

Tags: online.banking trojans, security firm, site, cent, card, research internet, Banking Services

Credit card users ‘want online services’

Most credit card users want the option of managing their account online, although it is not a key consideration when choosing a credit card.

Eighty per cent of respondents in a survey conducted by consumer research group Global Reviews said they would research cards online and 68 per cent said they would like to be able to manage their cards through the internet.

However only 40 per cent of those surveyed said being able to manage their cards online was an important consideration when choosing a card.

“As household budgets tighten across the UK, many credit card customers will start to notice the rates they have been paying on their credit cards and begin to look around for better deals,” Adam Goodvach, director of Global Reviews, told the Press Association.

Consumers using their credit or debit cards for online shopping were recently warned that their card details may not be as secure as expected. A test conducted by security consultancy SecureTest found that UK online businesses make “fundamental flaws” when handling their customers’ information.

Tags: Visa Debit, Eighty, group global reviews, business, online services, Press Association

Over £9 bn wasted by UK spenders in tax payments

Almost £9.3 billion is wasted by UK consumers through unnecessary tax payments, one financial expert has claimed.

The amount wasted in tax will increase by almost £1.4 billion compared to 2007 shows research from Unbiased.co.uk.

Up to 82 per cent of consumers admit to do nothing to reduce their payments, despite over 34 million people expressing dissatisfaction with the extra costs.

David Elms, chief executive of Unbiased.co.uk, said that tax payers are wasting record sums.

“We estimate that each UK tax payer will waste an average of over £290 in tax payments this year,” he stated.

The findings shows that unnecessary Inheritance Tax (IHT) payments are set to rise by over £360 million in 2008, resulting in a predicted total waste of over £1.9 billion.

This is despite IHT being named the most resented tax by one in five UK adults said the survey.

Further research from the company showed that 70 days of an average consumers annual wage is spent on clearing interest on credit card and loan debts.

Tags: uk, consumers annual wage, executive, dissatisfaction, Inheritance tax, Credit card, card, Unbiased.co.uk

Holiday dangers for credit card users

Holidaymakers are at a growing risk of credit card fraud when they are out of the UK, new research has warned.

Data published by Apacs this week shows that using credit cards in countries with less secure identity verification than the UK – particularly those which have not adopted Chip and PIN technology – puts consumers at greater risk of fraud.

“The Apacs figures show a staggering £90.5million rise in fraud abroad with UK cards being targeted in countries where Chip and PIN hasn’t yet been adopted”, said Neil Munroe, external affairs director at Equifax.

Cloning is a particular risk, Equifax claims, advising travellers to take as few cards away on holiday with them as possible, and never to let someone process a card payment out of their sight.

“ID and credit card fraud is a very real threat for consumers, making it essential that they take sensible precautions to protect themselves. Armed with the right knowledge, consumers can help minimise the risk of fraud and take fast action if they do become victims,” Mr Munroe added.

Tags: Travellers, credit card fraud, staggering £90.5million rise, card, GBP, chip and pin

Banks moving ahead of overdraft charges ruling

Banks have made a move to reduce overdraft charges ahead of the High Court ruling over unauthorised customer fees, according to new research.

Findings from MoneyExpert showed that the average unauthorised charge has dropped by five per cent over the past year, decreasing to 20.01 per cent compared with 25.25 per cent.

Sean Gardner, chief executive with finance experts, said that the current account market is changing very rapidly.

“It is encouraging that average unauthorised overdraft rates have dropped by five per cent in the past year. That said though a 20 per cent rate is still very high and well above the average standard credit card rate,” he said.

An estimated nine providers, including Northern Rock, still charge customers 29 per cent on going into the red.

According to MoneyExpert, a further 52 out of 136 accounts from 27 providers charge more than 25 per cent on their overdraft facilities.

Meanwhile, analysis from the financial experts showed that customers who insist on a passbook with their saving account are receiving an average of 0.5 per cent less on their cash.

Tags: Moneyexpert, Transactional account, Banking in the United Kingdom, findings, savings account, unauthorised, card

Paying off last year’s debts contributing to budget strain

Paying off last year’s debts and current levels of inflation are both using up consumers monthly budgets, one debt expert has claimed.

Debt Action said as inflation has kicked in, people have found that more of their take-home salary is taken up with paying back pre-Christmas loans as well day-to-day expenses.

Chris Tapp, director of Credit Action, said that increasing numbers of consumers have been forced to use their credit cards to fund their everyday lifestyle.

“This is a very worrying scenario to find yourself in and at that point – when you start using your credit card as a necessity, or you’re unable to pay it off month by month – you should go and get help,” he stated.

Credit Action also warned that in the long-term, consumers cannot use a credit card to pay off a mortgage and this is a “worrying indicator” for a spenders’ financial future.

According to figures from Debt Help UK, up to 74 million credit cards have been issued in Britain and by 2009, credit card possessions are estimated to rise to 99.2million cards.

Tags: consumers monthly budgets, strain, inflation, card, Chris Tapp, personal finance, christmas, Stoozing

Christmas spending goes on credit cards

The effects of the credit crunch failed to deter Christmas shoppers with a seasonal increase in the average outstanding balance recorded, according to new research.

Findings from Moneyextra.com shows that many spenders put their festive spending on their credit cards as the average balance jumped 17 per cent in January to £2,168.

Robin Amlot of Moneyextra.com, said: “There is a clear trend of falling outstanding credit card balances over the course of the last three years. The question is whether this actually reflects consumers clearing debts or merely a rescheduling of them.”

He adds that there is now a rise in other forms of borrowing, notably secured lending as consumers look to re-schedule expensive high-interest rate short-term credit card debt.

However, although credit card balances are up from the £1,842 recorded in December, they have not increased as much compared with previous years.

January 2008’s figure is down 25 per cent when compared with an average balance of £2,901 at the same time in 2007.

Meanwhile, Moneyextra.com said that consumers could save more than £4,500 by shopping around for financial products.

Tags: card, course, moneyextra, average balance, Robin Amlot, economics, Credit Cards, clear trend

Up to £1.6bn to be spent on Valentines day

British spenders are expected to splash out up to £1.6 billion on Valentines day gifts for loved ones, according to a recent survey.

Findings from PayPal revealed that the average spend per gift is thought to be £71.25 with those in a relationship spending £69.90.

Cristina Hoole, spokeswoman for PayPal, said: “It would seem that romance is far from dead as almost half of Brits will be splashing out a massive £1.6 billion on their loved ones this week.”

She added that as millions are expected to hit shops, up to one in five will choose to shop online for a gift to avoid the crowds.

Further findings from PayPal showed that up to a quarter of UK men are more likely to conduct their shopping online and 36 per cent of Brits in a relationship do not plan to give any presents.

Meanwhile, research from APACS, the UK’s payment association, revealed that credit card spending over the festive period totalled £32.2 billion.

Tags: quarter, UK men, romance, card, day, facebook

Shop around for credit card bargains, customers urged

Credit card customers should be prepared to shop around for the best card deals this month, just as they would for anything else in the January sales.

According to Sainsbury’s Bank, credit card users need to take the new start offered by the New Year to review their finances and make sure they are getting the best deal.

“Look around and see whether there are better deals than what you’re currently getting from your provider and that may well offer you an opportunity to reassess your costs,” urged head of cards Donald MacLeod.

He urged customers to pay off more than the monthly minimum amount on their cards in order to avoid going further into debt.

Figures released by UK payments association Apacs last month suggested that 64.3 per cent of the £53 billion spent in the run up to Christmas would be put onto credit cards, with the amounts put onto plastic accelerating in the last few days.

Tags: Christmas and holiday season, best card deals, finance, deal, January

Brits ‘bombarded’ with credit card cheques

British residents were sent 313 million undesired credit card cheques last year, it has emerged.

According to recent research, 96 per cent of all credit card cheques issued are unsolicited, with only one in 50 of the 22.5 million consumers sent the cheques actually asking for them.

Furthermore, it was found that many people are unaware of the charges they incur upon using the card, with 2.1 million credit card holders thinking no charges apply to the cheques.

In fact, using a credit card cheque costs consumers a total of £298 million more than a normal credit card purchase in interest and other related charges.

Mike Naylor, personal finance expert at uSwitch.com, the company carrying out the research, said: “During 2006, at the height of the media frenzy surrounding credit card cheques, some providers may have scaled down their promotional activities, but nowadays it would seem that it’s ‘business as usual’.

“The reality is that the credit card industry has far more to lose than consumers if people had to ‘opt-in’ to receive credit card cheques.”

Tags: Recent research, media frenzy, Business Finance, business, 5 million, industry, mike naylor

Defaqto: Cash in on cash back credit cards

Consumers are advised to take advantage of the offers available on cash back credit cards, according to Defaqto.

The company explains that, although comparing the best deals is not always straight forward, there are significant “incentives” for choosing them.

Principal consultant, David Black, commented: “Despite their complexities, cash back credit cards offer a genuine return for card holders but are only appropriate for those people who always pay off their entire balance every month.

“This is another example in the credit card industry where consumers can take advantage of the offers by having more than one card and using each selectively to maximise cash back earnings.”

Some of the complexities of conditions and bonuses include tiered earning rates, introductory enhanced rates, maximum qualifying spends and enhanced earnings at specific retailers.

Defaqto is an independent financial data collection and research body, giving up-to-date product information to the financial services industry.

Tags: Electronic commerce, consumers, product, industry, Defaqto, finance, card, advantage

Barclays Freedom credit card encourages frivolous spending

Barclay’s Bank has run into trouble once again, following accusations that it is encouraging consumers to spend more than they can afford, thus adding to the already mounting debt levels in the UK.

This is due to the the Freedom credit card which has been launched by the bank. The card offers consumers credit limits of up to £25,000, with an interest rate of 14.9% on the balance and an option to transfer the balance to a 6.6% loan if the customer wishes to do this.

On the advertisement for the Freedom credit card it stated: ‘If I see something I want, I need to be able to act quickly and not have to wait to arrange finance, or be stuck with a high rate of interest.’

However, concerned industry professionals and campaigners state that this card simply encourages frivolous spending, and increases the risk of consumers ending up in unmanageable levels of debt because of the high credit limits and the ability to switch to a loan. The loan can be paid between 3 months and 7 years with a fixed monthly repayment.

Barclays is trailing the card through a well known price comparison site, but has not confirmed how long the trial will last. However, experts have been quick to point out that the card could just be another way for the bank to make huge amounts of interest on super high balances from customers, or to increase its loan business through customers running up high balances and then transferring them to a loan with Barclays.

Credit cards are already known to be a major contributor to debt levels in the UK, and a card that offers such high credit limits could add ot the debt problems relating to credit cards significantly according to some experts.

Tags: concerned industry professionals, ability, consumers credit limits, card, business, way

Loans ‘good’ for debt consolidation if used wisely

People considering taking out a personal loa as a means to manage their finances are advised it is sensible if done sagely.

According to Moneyextra.com, if consumers are going to use this means to tame their finances, they must be careful not to build up debt on an overdraft or credit card at the same time.

Robin Amlot, senior editor at the financial services company, explained that debt consolidation is the “key reason” people chose to take out personal loans these days.

He advised a course of action for those doing so, saying: “Two key factors about taking out an unsecured personal loan as a way of consolidating your debts is that you are fixing your interest rate – so you know what you’ll be paying each month – and you are fixing a date in the future at which you will have cleared the debt.”

Recent research by Thomas Charles debt consultancy in association with YouGov found that 15 per cent of people in Britain are in serious debt, with men being more indebted than women overall.

Meanwhile, one in four Britons plan to avoid spending money on credit cards this Christmas.

Tags: Loans, credit, personal, card, consolidation, debt, debts

New card rewards ethical spending

The Co-operative Bank has announced the launch of ‘think’ today, which is a credit card aimed at rewarding consumers for making ethical purchases.

A world first, the card offers users a lower rate of interest of just seven per cent on all ethical spending with its partner organisations such as Lush, Adili.com and Ikea for six months after the payment is made.

Meanwhile, for each first use of the card, the bank has pledged to arrange the purchase and protection of half an acre of Brazilian rainforest.

David Anderson, chief executive of the Co-operative Bank, said: “According to our own Ethical Consumerism Report, conscious spending has been increasing at an average of 15 per cent a year since the start of the decade and all the signs are that this growth is set to continue.

“We want to reward those customers who make ethical choices and encourage everyone to really think about how their choices impact the wider world, which is why we have developed the new ‘think’ card.”

Furthermore, users of the ‘think’ card will be given discounts on selected partners including £35 with Ecotricity as well as reductions with Eco First and Nigel’s Eco Store.

Becoming more green is a hot issue for today’s consumers, who are increasingly calling for companies to show themselves ethically accountable.

Tags: launch, CreditCards.com, card, Anti-corporate activism, bank, Sustainability, six months, Ethics

Millions of Brits to switch credit cards

It is estimated that 6.5 million people in the UK will change their credit card provider in the coming year.

Over half of Brits switch credit cards to profit from interest free introductory offers for balance transfers, according to a study by Abbey.

The figure will see a five per cent increase on changes made last year and represents a total transfer between cards of £11 billion.

Roger Lovering, managing director of Santander Cards Limited, said: “These figures just show the intense competition in the credit card market. With £11 billion at stake, it’s the credit card with the best deal that wins.”

Furthermore, Abbey’s research showed 19 per cent of consumers change cards in order to take advantage of a lower APR.

Six per cent felt that a different card might have more “kudos”.

Mr Lovering added that Abbey offers interest free balance transfers for 12 months, as well as three months of interest free purchases.

Virgin are currently offering 15 months of free balance transfers with a typical APR of 15.9 per cent.

Tags: free introductory offers, Credit Cards, card, increase, 5 million, year.Over half, interest rate, advantage

Sainsbury’s increases interest free period on credit cards

The supermarket giant Sainsbury’s has been offering a range of financial products and services over the years, including some very competitive deals on credit cards.

According to recent reports the retail giant has now announced that its credit cards – which already offered an attractive ten months interest free credit on purchases – will now be offering an increased interest free period of twelve months, which is likely to attract increased custom as well as placing the cards amongst the top of the best buy tables.

Officials from Moneyfacts have stated that the cards are all the more attractive because they also offer a low rate life of balance transfer facility, so in addition to enjoy twelve months of interest free credit on purchases customers can also transfer costly existing credit card balances and enjoy a low rate of interest for the life of the transferred balance – the rate currently stands at 5.94%. The standard variable rate on the credit cards is 15.9%.

One official from Moneyfacts stated: “The standard and platinum deals were already competitive, but extending its offer to 12 months pushes its standard card to hold joint top position of the moneyfacts’ best buys, along with Halifax and HSBC, with all three offering a standard revert to rate of 15.9% APR. The Platinum card offer is market leading, with the next best interest free offer at 11 months. These cards also come with the added benefit of a lifetime balance transfer deal at 5.94% pa, which in today’s market is a pretty competitive. Combined with the 0% offer, these deals are a very attractive overall package.” 

She added that the Sainsbury’s credit cards were now looked upon as a five star deal, as they offered savings on both transferred balanced and purchases, making them great value and convenient.

Tom Smith
5th September 2007

Tags: purchases, card, sainsburys, introductory, transfers, balance, platinum, increased, credit

Credit card holders ‘wasting money’ on withdrawals

Consumers in the UK who use their credit cards in order to make cash withdrawals could find they are paying way over the odds in order to do so.

According to research from Moneysupermarket, Britons withdraw £8.3 billion using their credit cards annually – but they could be paying 27p per pound in interest and charges over the year.

The average amount paid across the major providers on one £20 withdrawal a month over the course of 12 months is 15 per cent, or £36.

“At a cost of up to 27p for every pound taken out, this is an exceptionally expensive way to spend,” said the price comparison site’s head of credit cards Rob Kenley.

“Wherever possible you should only withdraw cash from your current account, but we realise sometimes people face unexpected emergencies.”

A separate study from Abbey found recently that 23 per cent of credit card holders intend to consolidate different credit cards using one that offers a good value deal.

Tags: britons, moneysupermarket, wasting money, unexpected emergencies, cent, wasting, 12 months

Abbey launches credit card

Abbey has marked the launch of its new credit card with an eye-catching supermarket offer.

All customers will get five per cent cashback on the first £1,000 they spend in the stores while using the card.

Furthermore, every major supermarket has been signed up by the credit card provider as a participant in the scheme.

Abbey claims that, based on average spending figures, the offer will cover around five months of family shopping at supermarkets, assuming that the new credit card is used each time.

Roger Lovering, a managing director at Santander – the company which owns Abbey – said: “Our philosophy is all about offering real value for our customers. Supermarket cashback is the first example of that commitment.

“Once somebody becomes an Abbey credit card customer they can expect to see many more initiatives which offer similarly valuable benefits.”

The offer commences on September 3rd, and will apply until the end of January, 2008.

Tags: credit card customer, somebody, supermarket, card, cent, GBP, Supermarket cashback, Roger Lovering

No more chip and pin for RBS credit cards

The Royal Bank of Scotland (RBS) is all set to introduce a new contactless credit card which uses radio waves to make payments.

All you have to do is touch the new credit card on terminals provided at participating outlets to pay for items under £10 – no pin is required.

Shops will start to use the new technology in September. RBS’ launch comes close on the heels of the new OnePulse credit card introduced by Barclays.

The OnePulse card works in the same way but can also function as an Oyster card, Barclays having signed a three-year exclusive deal with Transport For London.

The speedy nature of RBSs new credit card’s transactions was displayed after the company drove an AT & T Williams formula one car to a McDonalds drive through to buy a meal using the new technology this week.

Tags: September, chip and pin, McDonalds, Credit Cards, chip, The Royal Bank of Scotland, formula, card

Many people permanently in the red with overdrafts

A recent report has highlighted that by the 20th of each month many Brits find themselves running out of cash and having to rely on their overdrafts to see them through the rest of the month until payday.

In some cases, once payday comes around, Brits are able to slide back into the black for several weeks. However, there are also many Brits that will go straight back into the red, even after their salary has been paid in, because their accounts are permanently overdrawn.

Around two million consumers in the UK are always in the red, unable to pull themselves out of their overdraft debt and therefore having to rely heavily on their overdraft facility. In the past year, according to research, around ten million people in the UK have used their overdraft on at least one occasion. Rising interest rates and repayments may have contributed to this figure, with more and more people having to dip into their overdrafts in order to stay afloat due to rising repayments.

One industry professional stated: ‘It’s no surprise so many people are permanently in the red – with interest rates having risen five times in the past year consumers are not doubt feeling the squeeze. People often dipping into their overdraft need to watch the Effective Annual Rate as some can be punitive and they may find they are better off spending on a 0% credit card in the future.’

Those aged 55 years and over were found to be the best at staying out of the red, with an impressive 64% in this age group managing to stay in the black. This compared to 40% of 18-24 year olds. In the 45-54 age group 5% were permanently in the red.

Tom Smith
31st July 2007

Tags: red, card, debt, bank, credit, personal, current, purchases, accounts

UK consumers struggle to remember pin codes

Research from high street bank Abbey has today revealed that consumers have trouble remembering their pin codes.

Fully 39 per cent of those polled by the card provider said that they write down their numbers so as not to forget them – although a big majority of this group disguised them in some way.

Making records of pin codes makes credit card fraud far more likely, as does making all cards carry the same code, as admitted to by 14 per cent of respondents.

Around 55 per cent admitted to having forgotten a number, with card holders increasingly owning more than one piece of plastic.

The survey found that six million Britons hold three cards, around three million hold four, and two million hold five cards or more.

Steve Shore, head of banking at Abbey, said that with many consumers holding multiple cards, “the challenge of remembering all those PIN codes is getting greater.

“But we really do urge you to try and commit them to memory rather than write them down. Otherwise it’s like signing a blank cheque for fraudsters.”

Tags: piece, Credit Cards, card, way, head of banking, card holders, cent, Payment systems

Plastic card spending grows

The amount of money we spend on debit and credit cards has increased three-fold in the last ten years, reaching record levels.

Figures from the UK payments association Apacs show that we spent a combined total of £321 billion on plastic cards in 2006.

That compares to the £87 billion that was spent in the same way back in 1996 and debit cards have seen the biggest rise.

Debit cards accounted for 61 per cent of all plastic card spend, totalling £195 billion – five times the amount spent in this way in 1996.

Credit cards accounted for 39 per cent of plastic card spend, with £126 billion being spent in this way – twice the amount of 1996.

“The last ten years have seen a rapid rise in the popularity of plastic, with debit cards showing particularly strong growth,” said Sandra Quinn, Apacs’ director of communications.

“Consumers enjoy the ease and convenience plastic cards bring and today most retailers and supermarkets take plastic, as do an increasing number of professional service providers.

“Over the next ten years it is expected that spending on plastic cards will continue to dominate the payments arena, accounting for 89 per cent of growth in UK payment volumes by 2016,” she added.

Spending in the retail sector saw the gap between cash and card payments widen between 2005 and 2006.

Tags: apacs, card, payment, card payments, UK payment volumes

An exercise regime for your finances

Many of us could do with giving our finances a good workout, just like we do when trying to get our bodies into shape.

The British Bankers’ Association (BBA) says that we can keep our finances looking fit just as we can begin living a healthier lifestyle.

We are being advised to review our finances and speak to our banks and financial advisors, much like how you might consult a gym for a fitness check.

Although many people find banking to be daunting and something of a chore, the BBA points out that getting your finances in order means you are better prepared for any future changes to your circumstances.

“The British Bankers’ Association is recommending customers take a little time to plan their financial needs just as you would consider your physical health,” said Angela Knight, chief executive of the BBA.

“That way you can ensure your finances are in good shape and you have the right banking and borrowing services in place.

“You can go to your bank and talk through your specific needs just as you would go to a personal trainer and talk through an exercise routine. It is vital that you set aside some time every month to review your bank statement,” she added.

The BBA has compiled a ‘Fit for Finance’ checklist and says that anyone considering visiting a financial advisor should run through the list and get a good idea of how they are doing.

The list asks: Do you pay your credit card balance in full every month? What plan do you have in place to repay a debt? And are you always struggling to cover debt repayments?

Tags: card, finances, bank, healthier lifestyle, physical health

20yrs of debit cards

Barclays will soon be celebrating 20 years of debit cards after it launched the UK’s first on June 3rd 1987.

The bank broke the mould when it introduced the Barclays Connect card and changed the face of banking forever.

Within nine months of its launch, one million people had a Connect card in their pocket and the debit card has gone from strength to strength ever since.

Today, around 68 million debit cards are in circulation, with many people owning more than one.

A total of 143 debit card purchases are made every second, 6.8 billion transactions take place each year and debit cards out number credit cards.

“Plastic has revolutionised the way people spend money over the last 40 years,” said Brian Cunnington, head of debit cards at Barclays.

“Ever since Barclaycard became the first credit card in Europe in 1966 the nation’s spending habits have changed.

“The introduction of debit cards 20 years later gave consumers even more flexibility allowing them to withdraw cash from ATMs as well as to have payments deducted directly from their current accounts when they paid in shops,” he added.

Debit cards have remained popular through slight changes that keep them up to date, such as the introduction of Chip and PIN technology.

Tags: pin technology, card, Product Release, money, Payment systems, Banking, banking forever.Within, uk

Contactless cards are on their way

The UK banking industry has confirmed that plans are in place to roll out contactless technology for debit and credit cards.

We could see the new system being put in place as early as September of this year, with consumers receiving new cards and retailers getting new receivers.

The UK payments association Apacs has revealed that transactions on the contactless cards will be limited to no more than £10 and users will not need to enter their pin number each time they make a purchase.

Apacs is assuring customers that their cards will remain safe and says that every now and then they will be required to enter their pin number for security reasons.

The cards will initially be introduced in London, spanning from the City to Canary Wharf, with a larger roll out planned across the whole of London and eventually nationally by the end of 2008.

The cards are being touted as an easier and quicker way for consumers to purchase everyday items and the banking industry believes that their introduction will encourage shoppers to use their cards rather than paying for low-value items with cash.

“We are confident that consumers in the United Kingdom will be quick to adopt contactless payments as they are faster and more convenient than cash increasing both the number of cards in issue and, as retailers benefit too, places where they can be used,” commented John Bushby from Mastercard Europe.

Cardholders should wait for correspondence from their card company to see what they need to do to get a contactless card.

Tags: bank, United Kingdom, card, new cards, year, introduction, Cardholders, europe

Holidaymakers take care of cash

Almost half of British tourists fear for the safety of their holiday cash and are prepared to go to any lengths to protect it, new research has found.

In a run-up to the Easter break, 45 per cent of people questioned in a survey for Lloyds TSB Money Card said they feared their holiday money would go astray, with 16 per cent even prepared to wear a bum bag to avoid having their cash stolen.

Of the 1,000 people questioned, a further 19 per cent said they hid their money in secret pockets of bags while soaking up the sun, while 23 per cent admitted to stashing cash away under their clothes to keep it safe.

In addition, 22 per cent said they spread their foreign currency across different places on their person in a bid to thwart pickpockets.

Despite fears about losing their money, over a third (36 per cent) of holidaymakers said they took between £400 and £1,000 in cash away with them.

“In a bid to keep our cash safe it seems that we are willing to go to embarrassing fashion extremes but, in this day and age, taking huge amounts of cash abroad just isn’t necessary,” said Jatin Patel, head of foreign transactions at Lloyds TSB.

The bank has just launched a new Visa-style money card which can be topped up with euros or dollars by travellers as they need it.

Meanwhile, research published by the Post Office this week shows that the pound is stretching further abroad this year.

Poland, the Czech Republic, Thailand and Hungary were found to be the only nations out of a total of 16 countries to offer poorer exchange rates to Britons than at the same time last year.

Tags: Hungary, post office, run-up, holidaymakers, card, Lloyds TSB.The bank, foreign currency, czech republic

Bailiffs may be given greater powers

Bailiffs may be given the power to break into your home for as little as an unpaid credit card bill.

At present only certain bailiffs are allowed to do this but the tribunals, courts and enforcement bill is set to get its second reading in the house of commons today (March 5th).

If it becomes law, all bailiffs will be able to enter your home to collect a debt but fears are growing that this may lead to an increase in cases of bailiffs abusing their powers.

Citizens Advice is pushing for an independent regulator to be included in the bill, ensuring that bailiffs are acting within the rules.

The organisation also wants to see safeguards brought in that will guarantee bailiffs are only forcibly entering a property as a last resort.

“This Bill should have been the perfect opportunity to modernise the law and end abuse once and for all,” said chief executive at Citizens Advice David Harker.

“Instead it gives bailiffs greater powers without any proper regulation – a recipe for abuse on an unprecedented scale.

“It is a scandal and a disgrace that six years after the government made a commitment to bring in independent regulation, the misery and abuse continues. It has to stop,” he added.

Research by Citizens Advice shows that 64 per cent of bailiffs were guilty of harassment and intimidation in England and Wales since October 2006.

It also found that 40 per cent had misrepresented their powers, while 42 per cent charged debtors excessive fees.

Tags: credit, england, Reuters, card, government, Citizens Advice

Financial habits are written in the stars

The time of year in which you were born may be affecting your payment habits and banking behaviour.

Research carried out by the UK payments association (Apacs) takes a light-hearted look at UK consumers’ payment habits according to their star sign.

The survey, which was completed by 2,000 people, found that Capricorns are the most financially astute, but they are let down when it comes to paying their credit card bills.

Scorpios are said to be the sign of the debit card, with the majority showing a strong preference for using this form of payment. In addition, people of this star sign are particularly financially savvy.

Those who fall under the sign of Libra are said to be uninterested in their finances and often fail to pay attention to detail, as well as being slow to check their statements.

“The guide takes a humorous astrological look at our payment habits. However there is a serious point to be made,” said Sandra Quinn, director of communications at Apacs.

“We all need to be conscious of how we are managing our finances – it pays to make sure you are doing it well and there is no better time than at the start of a new year to review things.

Ms Quinn says everyone should check their statements “promptly and thoroughly”, like Virgos, shred their documents when discarding them, unlike Taureans, and have a different pin number for every card owned, something not done by most Leos.

Tags: payment, Payment systems, Capricorns, UK payments association, card, finances

Credit card charges likely to rise

Credit card customers are likely to feel the squeeze as companies try to recover the £1 billion per year which will be lost as a result of a cap being introduced for penalty charges.

The Office of Fair Trading introduced the £12 cap, leaving a £1 billion shortfall for card companies which PricewaterhouseCoopers (PWC) says will be made up through increased charges and fewer zero per cent deals.

A report, released by PWC, says card companies are likely to make up the shortfall in this way, although there is disagreement over what effect an annual charge will have on consumers.

Some firms are not concerned that they may lose the custom of non-profitable card holders, while others do not want to anger these customers as they see an opportunity to sell other financial products to them.

Richard Thompson, one of the report’s authors, said he finds it difficult to see how the firms will be able to recoup the lost revenue.

“We are likely to see a waterbed effect, whereby charges pushed down in one area pop up somewhere else,” he said.

“Card issuers would have to levy annual fees costing the average credit card user £35 a year to recoup the potential £1bn loss.

“If lenders tried to recoup this through interest rates alone, we would see APRs increase by two percentage points on average,” added Mr Thompson.

Tags: card, cent, credit card user, cent deals.A report, lenders, loss, area

Put credit card fraud into perspective

As Christmas approaches many consumers in the UK have started to worry about the risk of Internet fraud, and although buying gifts and other related items online has become hugely popular over the years many are still worried about the possibility of becoming the victims of credit card fraud. This worry is further reinforced through the various warnings that always come out at around this time of year, warning consumers to beware of credit card fraudsters.

However, some new advice has now been issued by a company that works to protect both retailers and consumers from this type of crime. The 3rd Man has advised consumers not to listen to ‘scaremongers’, and has urged retailers to put this type of criminal activity into perspective. The 3rd Man wants more emphasis put on the fact that by and large Internet shopping is safe, and this is because most reputable retailers use secure software to ensure that the consumer’s financial and personal data is not compromised.

Each year billions of pounds is spent on Internet shopping by consumers in the UK, but the many stories about the risk of online shopping and credit card fraud could result in a drop in consumer confidence. The 3rd Man does advise consumers to ensure that the site that they are using is a secure one, and providing that this is the case there should be no need to worry.

The CEO of the company stated: “Every day there is a story about fraudsters cheating their way into our pockets. The introduction of Chip and PIN has made a massive impact on fraud, reducing crime in stores. It has also persuaded many fraudsters to target ‘card not present’ environments such as Internet shopping, but equally many retailers have recognised this and put in place proper systems to combat the criminals. If people wish to shop on the Internet they should be confident that it is fundamentally safe. It is the safest way to shop!”

More Info:

• Identity Theft

Tags: account, steal, cash, fraud, credit, charge, thief, bank, card