1 in 10 Brits Are Using The Wrong Credit Card

Four us Brits there’s no such thing greater than brand-loyalty. Ordinarily we’ll stick to a brand we know and love. Nothing changes when it comes to our choice of credit card. We would prefer to stick with our credit card provider through think and thin, no matter what the cost. And boy is it costing us!

Recent figures just published show that Brits are paying out over £120 million in extra interest and charges to our credit card providers simply because we prefer the UK credit card issuer we are currently using to the though of changing to a less expensive card issuer. Simply put: 1 in to 10 Brits is using the wrong credit card for their needs and the credit card issuers are the ones running to the bank. .

There may well be a number of valid reasons why we like to stick to a particular UK credit card issuer. Among these may be the simple fact of brand recognition. There’s also a certain matter of loyalty points to consider. If you are the type of credit card user that repays your credit account balance off in full each month all of these would be very valid reasons for sticking with your current UK credit card issuer.

Unfortunately, however, the vast majority of credit card users in Britons don’t pay off their credit card balance in full each month and a majority of us do carry-over a balance to the next statement period. Here’s where our dedication to brand loyalty is costing us dearly, because instead of electing to change credit card issuers and go with a credit card issuer offering a lower rate of interest than our current credit card provider, we stick with the one we’ve got.

With rising interest rates and tighter budgets, however, the time has now come to ask ourselves whether this brand loyalty to our existing credit card company is really worth an additional £120 million in interest each year? After all, would it not make much more sense for us to transfer our existing outstanding credit card balance over to a credit card issuer offering a 0% interest period? The money we could save doing this would most probably buy whatever it was we were saving up for in loyalty points anyway.

Alternatively you could stick with the credit card provider you have, pay the additional interest costs, and then wait and see if the credit card company are going to stick buy you when money gets tight and the monthly repayments get harder to make.

Richard Smith
21st August 2006

More Information:

• The Right Card for You - information from Choosing and Using, APACS' website
  Different credit cards will suit different people. The best credit card for you will depend upon how you intend to use it. Before you choose a credit card you should decide why you want it and how you intend to use it.
• Causes and Cures Of Credit Card Debt
  For some, credit cards can prove a temptation too far, and soon they find themselves in debt. Simple precautions will keep the savvy card holder from such dangers.
• Credit Card Types
  Credit cards have evolved from their early days into flexible financial tools for most types of spenders – and savers. But with so many types of credit cards on offer it can be somewhat overwhelming.

More UK Credit Card News
Try our feed