You are here: Home - Credit Cards & Loans - News -

Credit card customers urged to switch provider

Written by:
Millions of credit card customers are paying more than they need in interest because they fail to move provider.

Research shows nearly half of all UK credit card holders – around 17 million people – have never switched their card.

Many credit cards offer an introductory 0% APR deal, which typically lasts for 18 months. When the deal ends, they are automatically rolled onto a far higher interest rate, which could be anywhere from 20% to 30%.

Credit card holders must meet their minimum payment requirements each month to avoid going into default.

But according to the research by Compare the Market, over a third don’t pay off the full balance monthly, meaning they are more likely to pay more on their debt in interest, taking them longer to pay off the outstanding, if and when they roll off a 0% APR.

When asked why they hadn’t switched credit card provider, nearly one in five said they couldn’t be bothered.

However, over one in ten haven’t switched as they’re concerned they won’t get accepted by another provider.

By contrast, the top three reasons why people choose to switch credit card providers are that their 0% interest period was coming to an end, to get cash back or rewards, or to get a longer balance transfer period.

John Crossley, director of money at Compare the Market said: “The UK has woken up to the money saving benefits of switching energy tariff and insurance, so it’s surprising that more people aren’t doing the same when it comes to their credit card – particularly when the cost of rolling onto a default APR is so high.

“Reviewing your provider when your 0% APR offer comes to an end is a healthy way of staying on top of your finances and you can also take advantage of the different rewards which many cards now offer.

“Switching between providers is a relatively quick process but it is worth reviewing the different kind of credit cards available before making a decision. Take the time to use online tools which can help you check your credit score without damaging your credit rating and ensure you are on the best deal for your financial circumstances.”

There are 0 Comment(s)

If you wish to comment without signing in, click your cursor in the top box and tick the 'Sign in as a guest' box at the bottom.

The savings accounts paying the most interest

It’s time to get your finances in shape, and moving your cash savings to a higher paying deal is a good plac...

Everything you need to know about being furloughed

Few people had heard of ‘furlough’ before March 2020, but the coronavirus pandemic thrust the idea of bein...

The experts’ guide to sorting out your personal finances in 2021

From opting to ‘low spend’ months to imposing your own ‘cooling-off period’, industry experts reveal t...

What will happen if rates change

How your finances will be impacted by a rise in interest rates.

Regular Savings Calculator

Small regular contributions can build up nicely over time.

Online Savings Calculator

Work out how your online savings can build over time.

Having a baby and your finances: seven top tips

We’re guessing the Duchess of Cambridge won’t be fretting about maternity pay or whether she’ll still be...

Protecting family wealth: 10 tips for cutting inheritance tax

Inheritance tax - sometimes known as 'death tax' - can cause even more heartache for bereaved families. But th...

Travel insurance: Five tips to ensure a successful claim

Ahead of your summer holiday, it’s important to make sure you have the right level of travel cover or you co...

Money Tips of the Week