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: ability, card, industry professionals, Credit card balance transfer, business, consumers credit limits, concerned industry professionals