4.5 million Brits to transfer £3.2 billion credit card balance in the New Year

Over 4.5 million Brits or some 10 percent of the population are expected to move at least £3.2 billion pounds between credit cards in the first three months of 2010, to take advantage of introductory balance transfer periods, a new study by Santander Cards has revealed.

According to Santander Cards, the figure saw a rise of at least 66 percent compared with the same period in 2009 as savvy borrowers look for ways to better manage their finances. But the same study has shown that the total amount of debt being transferred fell by over 50 percent, from over £7 billion pounds just 12 months ago, as the Brits pay back record levels of unsecured credit.

Emma Roberts, director at Santander Cards said, “The number of people transferring balances has risen year on year, whilst the amount being transferred has fallen dramatically; this is a clear sign that consumers are becoming savvier when it comes to managing their finances. It’s encouraging that so many Britons are planning to take control of their finances in the New Year by transferring an outstanding credit card balance to a zero percent deal.”

On average, Brits will transfer an estimated £1,140 per balance transfer this year compared with £2,290 in 2009. Cardholders over 55 years old are the least likely to transfer balances between credit cards, with just five percent planning to do so, compared to 17 percent of those under 55 years old.

The study also marks significant regional disparities when it comes to New Year balance transfer plans. Those in the South East of England will be shifting the largest balance (£1,807), compared with those in the North East who will transfer an average of just £149. Interestingly, the North East also has the lowest proportion of switchers, with just eight per cent planning to shift their debt to a new card. In contrast, 34 percent of borrowers in Northern Ireland are planning to switch their balance in the New Year.