People advised to stick to credit purposes

Consumers should use financial products for their “right purposes”, according to Sainsbury’s Bank.

Steve Baillie, head of loans at the bank, explained that using personal loans, credit cards and overdrafts for the correct purposes will help consumers avoid getting into debt without “anything to show for it”.

“Buying cars with overdrafts or buying cars on credit cards can be very expensive business if you look at the APR. And also, you’ve got to look at the lifetime value of the product that you’re buying,” he said.

Purchases with a short life over a long period should not be considered, he continued, before urging consumers to do their “research” in advance of taking on any new commintments.

Credit Action revealed that in September this year total spending grew by £11.2 billion, while secured lending was up by £9.8 billion in the month.

Similarly, there was total growth over the month in consumer credit lending to £1.4 billion.

Tags: long period, Steve Baillie, right purposes, consumer, Unsecured debt, credit, consumer credit, overdraft