Consumers still suffering store card misery
Published On 18 December 2006
A large number of British consumers are still suffering from the dangerous lure of store cards, new research has found.The study by personal finance group The Motley Fool found that one in 14 consumers are still being lured by the availability of instant credit on store cards.
And it seems one in three consumers are still unaware of how much interest their store card charges. On top of this, the survey discovered that one in 16 people were unsure how much their store card costs and also failed to settle their monthly account in full.
David Kuo, Fool.co.uk spokesman, said: "Our survey shows that by and large store card holders are getting the gain without any of the pain. In general, store cards don't pose a problem if you pay off balances in full within the interest-free period, which is typically around 56 days.
"But a significant minority may find that any benefits they had initially hoped for have been eroded by high interest charges because they have not paid off their balances in full.
"So if it is going to take a few months to clear your store card balances, then it makes sense to take out a nought per cent card even if you have to pay a balance transfer fee. A one-off two per cent balance transfer fee is considerably better than paying two per cent interest charges month after month."
A small minority of shoppers – three in one hundred – admitted to succumbing to a store card after facing the hard sell from a pushy sales assistant.
