UK, March 7, 2023: New Experian data shows that two thirds (68%) of consumers could save over £1,000 a year on interest payments if they switch to more competitive credit cards. This comes after the Bank of England revealed that in January the annual growth in credit card spending grew at its greatest rate since October 2005.
Despite credit card borrowing increasing by 13.5% compared to last January, the highest level of annual growth since October 2005 (13.7%), it has mainly been on existing cards, suggesting that many are sticking to their existing cards 3 rather than shopping around for opportunities to save.
According to Experian data, consumers’ loyalty to their current lenders could be costing them hundreds of pounds a year in potential savings. Over two thirds (68%) of customers may be eligible for 0% cards, which could help them save more than £1,000 on interest payments.
How could people save £1000?
The Money Charity estimated in November that each UK household has an average credit card debt of £2,290. 4 A customer with this balance could save £844.85 by shifting their existing balance onto a 0% balance transfer card. They could also save a further £333 in interest by putting their new spending of £1,000 on a 0% purchase card. This would give them a total saving of £1,177.85 on interest payments per year. 5
There are currently 49 0% balance transfer card deals, six 0% purchase cards and 17 cards that offer 0% on both balance transfers and purchases on Experian’s marketplace, with up to a maximum of a 31-month 0% interest period. 6
James Jones, Head of Consumer Affairs at Experian said: “Our data suggests that many of our customers are eligible for 0% cards which could help those with existing borrowing ease the squeeze on their purse strings. When used responsibly, 0% cards could make repayments more affordable, either by reducing the amount you spend on interest or enabling you to clear your debt sooner. While there’s often a fee associated with the switch, you won’t need to pay interest for a period of up to two years, meaning every penny goes towards paying what you owe.”
Notes to Editors:
6. Data taken from Experian Marketplace in March 2023
Eliza Odire-Boadi, Consumer PR Manager, Experian UK&I
Tel: 07816192572 / Email: firstname.lastname@example.org
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