LONDON, ENGLAND, November 21, 2009
/24-7PressRelease/ -- A startling report from
Financial Facts has identified that consumers are ignoring the many benefits of credit cards due to worries of nightmare debts.
Paul Rodford, of the UK Cards Association, notes: "the future of credit cards is under threat as never before." Last year, credit card borrowing dropped 3% and the number of cards in circulation fell by 8%. Consequently, the total value of card transactions fell 27%. Poorly chosen credit cards have caused bad debts to reach new highs. Total credit-card write-offs stood at 5.8% in 2008; PriceWaterhouseCoopers have predicted this figure could reach 9% by the end of 2010.
Even the Church itself has spoken out against UK credit cards. A spokesman, Dr John Preston, warned: "whether you spend GBP10 or a GBP1,000 on a credit card it's one slip and one signature. But with cash you really feel the difference." Worldwide, even the cheapest credit cards have experienced an increased amount of resistance. A new National Retail Federation Survey found that approximately 71% of holiday shoppers would be using debit cards or cash to pay for their Christmas spending.
Financial Facts suggests that the lack of quality credit cards on the market is a serious problem. Many consumers apply to instant decision credit cards out of desperation, without finding the best
UK credit card deals for their situation.
Despite these concerns, Financial Facts reminds everyone to avoid scare-mongering. As Richard Dodd, of the British Retail Consortium comments, "credit is an important device to spread the cost of a range of needs and wants, at anytime, including at Christmas."
Comparing many instant decision credit cards deals, Financial Facts recommends a credit card that combines a relatively low APR, but avoids the excessively low minimum monthly payments that can silently built up debt. With 13 months of 0% balance transfer, 3 months 0% purchases and a variable APR of only 15.9%, the
MBNA Platinum Plus credit card is near-perfect. Unlike most credit card companies, the Bank of America also offers a free credit management service, so there is no risk of any payments going out of control.
References:
http://www.financialfacts.org
http://www.pwc.co.uk/eng/publications/precious_plastic.html
http://www.mbna.co.uk/help-centre/credit-sense/index.html---
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