A new report has warned that shoppers in the UK could end up paying an annual percentage rate of over 24 per cent if they pay for goods using store card credit.
Figures compiled by MoneyExpert.com show that store card credit is generally more than four times more expensive than taking on credit card debt and the company advises consumers to avoid this form of borrowing.
A number of retailers in the UK have increased the rates on their cards since last year and store card users could be left with a serious debt management hangover if they spend with this kind of plastic in the run up to Christmas, MoneyExpert.com insists.
“With store cards the advice is simple. Don’t use them. Avoid the gimmicks, don’t be lured in,” said MoneyExpert.com’s chief executive Sean Gardner.
“Invariably people forget about spending on their plastic, or they use credit precisely because they know they won’t be able to repay the debt immediately,” he added.
The UK’s payment association Apacs expects to see more money than spent by British consumers over the course of December 2007 than in any other month.