Credit card users ‘needlessly wasting millions’

UK holidaymakers lose in excess of £326 million every year as banks and building societies unnecessarily charge them for using their credit and debit cards overseas, it has been revealed.

Figures produced by UK payments association Apacs show £12.3 billion worth of transactions were made on credit cards overseas last year, with customers estimated to have been billed £326.2 million for this privilege, based on an average charge of 2.75 per cent.

Indeed, Nationwide divisional Director Jeremy Wood points out that many credit card providers have actually increased their charges for overseas transactions recently.

For instance, Lloyds TSB is to raise the charge on its debit card from 2.75 per cent to 2.99 per cent and NatWest has effectuated a similar hike from 2.65 per cent to 2.75 per cent.

Meanwhile, Mr Wood has highlighted the fact that Nationwide’s credit and debit cards are fee-free when used abroad.

“People who are planning to go abroad over the next few months should be aware of the hidden charges that most card providers impose which are both costly and unnecessary,” he commented.

“Anyone using a Nationwide debit card or credit card will not be charged any foreign usage fees and will therefore have a little more money to help them enjoy their holiday.”

However, a charge is applicable for ATM withdrawals when using Nationwide products in foreign countries.

Tags: Credit card users, divisional Director, foreign usage fees, building societies, Jeremy Wood, year, anyone

Rewards Credit Cards – Compare Credit Card Rewards Programs Online

Credit card users in the UK can enjoy a good choice of cards these days to suit all needs and circumstances.

One popular type of card is the reward credit card, and these cards are available from a wide range of card issuers offering a variety of rewards. With rewards credit cards you can earn points or rewards when you spend on the card, and these points can then be exchanged for goods, vouchers, or money off purchases depending on the type of card and reward that you choose.

As with other types of credit cards it is best to avoid making cash transactions on rewards credit cards, as card companies tend to charge hefty rates of interest and expensive charges on cash transactions. Also, no reward is received on cash transactions, and therefore you will not receive the full benefit of the card and may offset the benefits of the card through having to pay interest and charges on your cash transactions.

The interest rates, reward levels, and types of rewards offered on reward credit cards can vary from one credit card company to another, and this means that it is important to compare a range of cards in order to find the best one for you. Those that will benefit the most from these reward credit cards are those that repay their balance in full at the end of each month.

If you repay your balance in full each month rather than spreading the repayments you can earn the loyalty or rewards points on purchases that you make on the card but you won’t have to pay any interest, which enables you to really make the most of this type of card.

You can get all sorts of rewards credit cards, such as branded rewards credit cards and rewards based cards from supermarkets that enable you to earn store loyalty points.

The more you spend on your rewards credit card the more rewards points you can earn, and the better the rewards. For those looking to spread repayments on their credit cards a low interest or 0% interest on purchases credit card is probably more beneficial that a rewards card.

If you are looking to apply for a rewards credit card to earn points or rewards when you spend you should bear in mind that the terms and conditions as well as the rewards can vary. You can compare the range of rewards credit card easily and conveniently online, where you can also make your application.

Tags: month, reward credit card, Reward website, Credit card users, wide range, rewards credit cards, benefit, business

Credit card cloning warning

Credit card users in Norfolk have been warned to be on their guard after two reports of cloning in the region.

In both instances, money was removed and cashed in Malaysia, with the card owner none the wiser until their statement arrived.

One victim, Lucy Webster, saw £280 taken from her in four separate transactions and was only made aware when her bank called her.

Mrs Webster insists that she has never disclosed her Pin number to anyone and cannot understand how the money was taken.

“It’s very worrying, and I wanted to warn people to be aware that it’s happening because you never think it will happen to you,” she told website EDP24.

Norfolk police, and other forces around the country, are warning card holders to take special precautions to ensure they do not become a victim of cloning.

Ensuring documents such as balance statements are properly shredded and shielding your hand when entering your Pin are just two handy hints.

Tags: EDP, Computer security, card owner, Ensuring, Smart cards, bank

Credit Card Insurance

Fear factor

These days we are inundated with stories about identity theft, muggings, credit card theft and the general dangers of losing our treasured credit cards.

The dangers of modern living with its job insecurity, illness, theft and all those other things we dread are quite enough to make anybody want to turn to insurance for their own peace of mind. But are Credit Card Protection Plans the answer?

A Sign of the Times

When you start to use a credit card you will get an offer from the lending company to provide you with Credit Card Insurance. Primarily this is to safeguard the money that the institution has lent you. If you lose your job and go belly up with thousands owing on your card and no way to pay it back, they will want a way to ensure their money is safe. It’s also a way for them to make some extra money off you!

There are two main dangers for credit card users:

• loss or theft of the cards themselves
• loss of income

Live dangerously

There are those that regard the risks associated with the debts on a credit card as being tolerable. If you are one of those people who always knows where their credit cards are and has never lost anything ever, then you may feel the same way. You may also count yourself lucky!

Too much

Sometimes people feel insurance is an unnecessary cost because the package being promoted by the credit card company isn’t offering what the cardholder actually wants. It may not be the best value for money or it may be that it provides too much cover. If this is the case there are a number of off-the-shelf alternatives.

Safeguard against risks

Usually a Card Protection Plan (CPP) will provide some insurance against fraudulent use of your card or use of your card without authorisation. They will also include a facility for an emergency cash advance for ticket replacement and hotel bills (in case you suffer lose or theft while staying away) and may provide some cover for any cash that was stolen at the same time as your card.

But there are alternatives to CPPs.

And the family came too

Sentinel Card Protection is one of the most well known insurers specialising in credit cards. For a one-off annual fee they will protect all your credit cards with the same cover. That includes notifying all card companies involved in a theft of your cards and arranging for replacements to be issued. They provide up to £75,000 worth of cover against fraudulent use if they are notified within 24 hours of the loss or theft. They also provide an interest free loan for up to £3,000 to get you out of trouble if you are stranded abroad.

The key thing about Sentinel is that it will cover all your cards and all those of other members of the household with the same one off payment. It offers a three year one off payment option which is even better value at just £50.00.

Their service includes handy items such as a luggage tag retrieval service, so no matter where your luggage may end up Sentinel will help you get it back with their security coded unique reference number system.

They do not however, cover redundancy or your inability to make payments due to long term illness. For this type of cover you would need Payment Protection Insurance or PPI.

Holistic care for your Credit cards

This approach is to insure your payments so that you can continue paying if you get sick or suffer an accident which leaves you unable to work. A plan such as Paymentcare would be issued by a Financial Services Company and could be arranged either directly with the insurer through the internet, or through your broker or Financial Advisor.

This type of insurance will specify how high the maximum balance can be to be eligible for cover, and how long the policy will pay the credit card payments or whether it pays off the full sum in one go.

All these details would be raised as you discuss the plan with your broker or fill in the application form. In this way you can be sure to get an insurance policy that exactly suits what you are looking for. The premiums are usually payable as monthly direct debits and the amount would reflect the type of cover you chose.

Better to be safe than sorry

Whether you decide to insure yourself against the risk of being unable to repay the outstanding balance on your credit cards will really come down to your general outlook on life and your whole attitude to risk… and whether you think the world is really as unsafe as we are all led to believe.

Tags: better value, theft, credit card theft, unnecessary cost, ticket replacement, job insecurity, payment protection insurance, Credit card users