Store Credit Card Spending Down
Store card and store instalment credit business was down in November new figures show, highlighting the cautious nature of consumer spending.
Store card spending was down by 25 percent and credit card spending was flat when compared to November 2009.
The figures released by the Finance & Leasing Association revealed personal unsecured loans rose by 34 percent in November, suggesting the nation is keen to pay off their debts.
This however, was being compared to November 2009 when lenders were granting a very low level of credit.
“These figures send a clear message to the Government about the challenges to be faced when considering further regulatory changes in the consumer credit sector,” said Fiona Hoyle, FLA consumer finance head.
“This year credit firms will implement the Consumer Credit Directive, which will offer even more protection to consumers.”
The Consumer Credit Directive will come into effect from 1st February, to give customers clearer information about the rates on credit they are likely to be charged.
However, research by uSwitch shows just one in ten consumers understand what the directive will mean, and some admit they will be put off from taking out a credit card if advertised rates were much higher.
Compare Prepaid Credit Cards to Get Out of Debt
If you are keen to repay your debts and are unsure about taking out a credit card at the present time, you could consider a prepaid credit card as an alternative.
Unlike a credit card, a prepaid credit card does not present you with a bill as you are not borrowing money.
It acts as a means to control your spending as the user has to load their money onto it to spend accordingly.
If you are paying off debts then a prepaid card can ensure you do not overspend as the card does not allow the user to spend more than they loaded onto the card.