Consumers who often use their credit card to purchase goods should ensure they keep up repayments if they want to avoid debt management help, it has b…
Consumers who often use their credit card to purchase goods should ensure they keep up repayments if they want to avoid debt management help, it has been suggested.
According to Moneyfacts.co.uk, credit cards are still considered ‘high-risk’ items.
The website noted promotions on the products are at an all-time high but warned interest rates are continuing to rise.
Such a feeling comes in response to a report by Credit Action, which revealed UK banks and societies wrote off £9.6 billion of loans to individuals in the last year, ending in the first quarter.
In quarter one alone, the organisations cancelled £2.13 billion, of which £1.25 billion was credit card debt.
Such a figure amounts to £23.35 million a day being written off.
A spokeswoman from Moneyfacts.co.uk said it is important consumers consider the long-term implications of meeting monthly repayments and advised individuals to check their credit rating.
The industry figure observed: “The risk of unemployment is still high for many and credit card debt is always the first out of all debts which a person will default on.”
She added providers are therefore still very cautious about who they choose to lend to.
The specialist explained people should strive to ensure they can make more than the minimum monthly amount in an effort to pay off what they owe more quickly.
Credit Action also reported total personal debt in the UK stood at £1,457 billion in June, with the 12-month growth remaining at 0.8 per cent.
This means individuals in Britain owe more than what the whole nation produces in a year.
By Joe Shervin