UK’s British Telecom has really gone on the front foot over the last few years. After a period of uncertainty regarding it’s fixed landline business, initiative after initiative seems to be steamrolling the telecoms market. This concerted offensive is now spreading into financial services with a credit card that offers to reduce customers bills as they spend.
The key features of this credit card are as follows:
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All credit cards used recklessly can cause debt headaches. However, it appears to be no frills cards that are currently in the spotlight.
A leading Australian researcher from Cannex retail information says:
“It only takes a few slips to turn a low-rate credit card into a penalty fee devouring monster
Most of us get caught with credit card penalties on the odd occasion but consumers who regularly incur penalty fees due to household budget pressures are building their debt,” Cannex analyst Harry Senlitonga says.
“Consumers think they are doing the responsible thing by getting a no-frills card but it can defeat the purpose entirely if the account is not managed correctly.”
Evidence suggests that an interest rate of under 10 per cent rises to about 22 per cent over a year if two late payment penalties of $25 each and two over the limit penalties of $35 each are incurred. That can really add up.
Help might be at hand with international movement on this issue.
For instance British banks are having to reduce penalty charges on credit cards, and in some cases provide refunds in light of recent legal challenges.
Posted by Tom Wilkins on Wed 4th July 2007 at 06:00 AM, Filed in Credit News
UK’s debt interest repayments are now reaching scary proportions with annual bills expected to hit £100bn for the first time.
This mountain of serviced debt now equates to approximately £1 in every £8 spent by UK households according to Grant Thornton.
This debt interest is broken down into £72.8bn related to mortgages and £ 28.7bn related to credit cards, loans and overdrafts.
The scary bit is that with an estimated 25 million households these figures add up to an average of £4,000 each. It surely must be a matter of time before recent interest rate rises by the Bank of England have serious consequences for those even slightly over extended
Might be time to hunker down with the tin hats!!
Anecdotal evidence suggests that parts of Spain are becoming hot spots for all manor of credit card fraud. This is further supported by news of 3,000 blocked credit cards by Bancaja.
The call to action took place after a wide scale fraud operation.
According to reports:
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Credit demand is still insatiable. Much of the western world now borrows increasingly on credit cards and this is set to continue.
But what if you wanted to wean yourself off easily available credit. What would you do?
Here are some ideas:
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