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News in Credit Cards
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Lloyds puts an end to charity cards
Major banking group Lloyds has decided to end its charity cards from companies such as Halifax and the Royal Bank of Scotland.
Charity credit cards are a way for people to donate money just by using plastic on transactions in stores. Many companies offer a system where funds are given to organisations once an account is opened and then for every transaction over a certain amount a percentage is donated to charity.
However, Lloyds believes that this is not a cost-effective way of giving money and has taken the decision to withdraw its cards from banks and building societies.
In the past 23 years the company has donated millions to charities such as Cancer Research UK and the NSPCC but now it will end the scheme in the coming weeks.
Baroness Finlay, vice chair of the all-party parliamentary group on cancer, criticised the decision.
She told BBC Radio 4's Money Box programme: "I think a bank which can produce that amount of additional money to give large bonuses has to look very hard at whether it should be giving back to the society on which it depends for its business." More »
By Sarah Engle, Credit Cards - Mon 30 Jan 2012
More Brits expect to continue using credit cards in 2012
British consumers have admitted they will continue to use credit cards to make ends meet throughout 2012.
New research by Gocompare.com has found that UK users will still be paying back debt on their credit cards during the coming year. The website found that over a quarter (26 per cent) of people expected to owe money on their plastic whilst one in ten (9 per cent) are relying on cards to help them through 2012.
Whilst the survey showed that consumers were worried about the rising costs of bills and loans, food shopping and travel costs were found to be the main outgoing cost of the average household.
Jeremy Cryer, Gocompare.com's head of credit cards, said "The rising cost of living is placing a strain on many families and credit cards are being used to temporarily ease the pain. If used carefully, plastic cards can be a useful budgeting tool, but when used to plug a gap in everyday spending, card debt can quickly spiral out of control."
Recent research by uSwitch found that consumer confidence in credit cards had reached an all time low with many users starting 2012 in debt following a costly Christmas period. More »
By Sarah Engle, Credit Cards - Tue 24 Jan 2012
Unpaid credit cards force personal debts up
Debts in the north of Northamptonshire are continuing to rise due to unpaid credit card bills, high interest loans and mortgage arrears.
Figures obtained by the Evening Telegraph have shown that people were contacting the Citizen's Advice Bureau (CAB) for debt advice. The organisation said that some cases reported to have debts of up to £40,000.
Many companies have been warning people about the implications of short term loans and credit cards. Payday lender Wonga was heavily criticised for trying to entice students to take up high interest loans as a way to pay back any debt they had amassed whilst at university.
In Northamptonshire the CAB found that between October and December those contacting it had debts totalling £486,745 up on the previous year's figure of £362,857.
Maggie McLeod, CAB debt advisor for Corby and Kettering, told the source: "People struggling to pay their bills are finding it too easy to get cash through pay day loans. Sometimes they don’t even have to speak to someone to get the cash." More »
By Sarah Engle, Credit Cards - Mon 23 Jan 2012
Credit card confidence hits all time low
Consumer confidence in credit cards has hit an all time low, according to new research by uSwitch.
Many users have started 2012 in debt following a costly Christmas period, and while it had originally been thought that consumers would turn to credit cards to help them ease out of the red, uSwitch's new report suggests otherwise.
The service provider revealed that two million people were unhappy with their current credit card deal, with companies such as Bank of Scotland, Santander and Halifax faring the worst in the survey.
uSwitch found that 51 per cent of people have had the same credit card for the past five years, while 25 per cent had more than three cards, down from 30 per cent in the previous year.
Michael Ossei, personal finance expert at the company, said: "With overall satisfaction and customer service getting worse across the board, and the high street banks still providing some of the worst service, consumers should look around further afield at new providers for the best credit card for them."
The Post Office recently predicted in its Consumer Report that 38 per cent of people will spend more than £200 on their plastic in January 2012. More »
By Sarah Engle, Credit Cards - Thu 19 Jan 2012
New credit card allows people to switch account
A new hi-tech credit card that could render all other competitors obsolete is to set to be trialled in the UK.
The new card allows consumers to switch between accounts at just the switch of a button on the payment method itself.
Many people carry a host of credit cards in their wallet at any one time but experts believe that this development will blow all other cards out of the water.
Users will be able to access different accounts on the device as it has an interface including buttons and a screen. The card is already in use by US bank Citibank, and makers Dynamics inc said it was already in "advanced" discussions with UK banks and hoped to begin trials within months.
Eziah Syed, of makers Dynamics, said: "We've squeezed an entire computer into something the size of a credit card. These cards are about making things easier, and we think that in high volumes the costs are very low."
Since the Christmas period many Brits have been turning to credit cards as a financial solution due to a number of low interest rates offered by building societies. More »
By Sarah Engle, Credit Cards - Thu 12 Jan 2012
Consumers cutting back on credit card spending
Consumers in the UK are becoming more cautious after Santander reported that they are cutting back on credit card spending.
The bank also announced that Brits were making more purchases but the typical spend on a credit card has fallen by four per cent in the past year.
Santander reported that the amount spent in sports and toy stores saw the biggest fall in the value of money spent, dropping by 24 per cent per user, while travel agencies came second with a 13 per cent decrease.
It suggests that consumers are becoming savvier with purchases in general with customers using credit cards more frequently to make purchases as providers have upped competition with incentives and loyalty offers.
Callum Gibson, managing director at Santander Cards, said: "During times of austerity, you'd expect cutbacks to hit non-essential items like holidays and clothes. However, we've seen a drop in overall spend people are using their cards more, as demonstrated by the increase in number of transactions."
The Post Office recently said that it expected to see a rise in people using credit cards to pay for expenses such as rent and bills. More »
By Sarah Engle, Credit Cards - Wed 11 Jan 2012
One in five Brits struggle to manage debts
One in five consumers in Britain have admitted to struggling to manage their debts, according to new research by the Money Advice Trust.
In was recently found that after the costly Christmas period many people were turning to payday loans to cover their outgoings from the festivities. John Lamidey, chief executive of the Consumer Finance Association, added that using short-term loans to pay for mortgages was "simply impossible".
Now, officials at the trust have found that the number of people getting help from free debt advice agencies increased in 2011 to 1.54 million people, compared to 1.4 million in 2010.
The figures also revealed that an estimated ten million people (20 per cent of the adult population) find themselves in a "constant struggle" to manage debts.
Joanna Elson OBE, chief executive of the Money Advice Trust, said: "2011 was a tough financial year for many families across the UK; unfortunately more people are likely to struggle in 2012. With unemployment rising and wage growth relatively flat it's going to take a greater proportion of household income to heat your home, put food on your table and petrol in your car." More »
By Sarah Engle, Credit Cards - Wed 11 Jan 2012
Credit card users benefitting from low interest rates
Many Brits are turning to credit cards as a financial solution due to a number of low interest rates.
Savers had been advised last month to shop around for the best deal on cards and look out for companies offering zero per cent interest on their schemes. The base rate of interest being held at a current record low of 0.5 per cent by the Bank of England with advisers saying there is no better time to switch to credit cards.
The Post Office's annual Consumer Credit Report found that over 12 million people will spend the first month of 2012 relying on credit cards to help pay for bills and living costs. The figure is a two per cent rise on the same period in 2011 with 38 per cent of Brits increasing their credit card spending by £200.
Bernard Clarke, communications manager at the Council of Mortgage Lenders, told Vanquis: "The likelihood [is] that interest rates will remain at low levels for the foreseeable future. Any rise is likely to be modest and that the increases are likely to be relatively slow." More »
By Sarah Engle, Credit Cards - Tue 10 Jan 2012
British Council defends credit card bill
The British Council has defended spending £7 million on credit cards in the past two years after a group accused staff of "living the high life abroad".
A Freedom of Information request by the TaxPayers' Alliance found that employees at the council stayed in five star hotels and dined at expensive restaurants with the taxpayer footing the bill.
The British Council spokeswoman said most of its revenue was generated privately and did not come from the public purse.
She said: "Whilst we understand and recognise the importance of the role of the TaxPayers' Alliance, it is unfortunate that they have not recognised that the British Council actually earns the majority of its income and is only partly funded by UK taxpayers."
It was recently announced by the government that companies would be banned from charging extra hidden fees for customers that use debit or credit cards to pay for online transactions. More »
By Sarah Engle, Credit Cards - Mon 9 Jan 2012
Credit card usage to increase in January
The number of people in the UK that rely on credit cards has increased in January compared to 2011 figures.
Research by the Post Office found that consumers in Britain are still counting the cost of the Christmas period and are struggling with the rising price of winter fuel bills.
The company's annual Consumer Credit Report found that over 12 million will spend the first month of 2012 relying on credit cards to help pay for bills and living costs. The figure is a two per cent rise on the same period in 2011 with 38 per cent of Brits increasing their credit card spending by £200.
Az Alibhal, from the Post Office, said: "Whilst it is good to see so many people intending to manage their credit card purchases and repayments sensibly, there are still too many people who aren't thinking of the consequences."
Experts have also warned consumers not to turn to high interest payday loans to pay for mortgages and rent payments. More »
By Sarah Engle, Credit Cards - Thu 5 Jan 2012
Credit ratings more important in 2012
Consumers are being urged to make sorting their credit rating their top priority in 2012 as the economic crisis is set to continue. More »
By Sarah Engle, Credit Cards - Fri 30 Dec 2011
Consumers warned over credit card debt
Once the Christmas period is over many are left counting the cost of a busy festive season and those who have spent money on credit cards are being urged to keep on top of their debt. More »
By Sarah Engle, Credit Cards - Thu 29 Dec 2011
Consumers continue to pay off credit card debt
Consumers in the UK are continuing to try and pay off the debt amassed on credit cards and November saw people paying off more than they spent. More »
By Sarah Engle, Credit Cards - Wed 28 Dec 2011
Spread the cost with effective credit cards at Christmas
With an increase in the number of people who will struggle to afford the cost of Christmas this year, those who plan to seek funding through their plastic friends have been offered advice from two financial bodies. More »
By Sarah Engle, Credit Cards - Fri 2 Dec 2011
Brits ignore PM to keep on borrowing
British consumers are ignoring the advice handed out by the prime minister and are continuing to borrow money on credit cards. More »
By Sarah Engle, Credit Cards - Thu 1 Dec 2011
Brits in credit card debt looking for Christmas windfall
Those who are worrying about funding the cost of Christmas through putting themselves into debt with credit cards are hoping for a Christmas windfall to help them out. More »
By Sarah Engle, Credit Cards - Thu 1 Dec 2011
Redundancies can lead to credit card debts
The number of people who have been affected by redundancy, particularly in the past year, could mean a sharp rise in the number of borrowers who cannot afford to pay off the debts on their credit cards. More »
By Sarah Engle, Credit Cards - Wed 9 Nov 2011
Brits without cash to use credit cards to fund Christmas
Only a third of Brits have enough disposable income to be able to afford Christmas off their own backs, leaving the need to find funds from elsewhere the only option for many families. More »
By Sarah Engle, Credit Cards - Mon 7 Nov 2011
Spending at Christmas can reap rewards
People who are disciplined with their finances can reap the rewards of Christmas spending by choosing to use the right credit cards. More »
By Sarah Engle, Credit Cards - Wed 2 Nov 2011
