Credit card limits increased without asking

With the white paper on credit cards from the government today, it is concerning to see that nearly 6 million credit card holders have received increased credit card limits without asking.

According to uSwitch.com, these credit card limits have been increased by an average £1,538 over the last 12 months, equating to nearly an extra £9 billion of credit.

This could add over £1,000 to the annual credit interest bill if a card is maxed out to the new limit.

Personal finance expert at uSwitch.com, Louise Bond, said ‘Unless you are one of the 68% of consumers that regularly pay their credit card bill in full, keeping high levels of debt on interest bearing credit cards isn’t advisable as it’s an expensive form of borrowing.

In most cases, providers really aren’t helping consumers by throwing cash at them as it could be placing unnecessary temptation in their path.’

Credit cards can be an expensive way to borrow money, unless you manage them carefully and take advantage of special 0% interest deals on balance transfers and purchases.

If you have larger debts that cannot be paid off over a short period then it may be best to consider an unsecured loan, there are some good loan deals still available.

If your debts are mounting though don’t let them go unchecked for too long as they could lead to serious consequences. It may be worth getting some debt management advice.