CHESTER, England, August 30, 2012 /PRNewswire/ --
- Nearly half rely on it for day to day spending
- A quarter have relied more on credit this year
Brits are collectively sitting on £260 billion of available credit according to new research by MoneySupemarket.*
The research found the average Brit has two credit cards with an average credit allowance of almost £7,500*. However, one in five (22 per cent) Brits have three or more credit cards in their wallet with an average of £12,049 available to use. Those aged 35-54 have on average £8,292.77 of available credit compared to the younger generations (18-34) who have almost half; £4,637.84.
When it comes to their plastic pals, two thirds (64 per cent) said they use it for online shopping, 50 per cent for holidays and travel, while 46 per cent need it for day to day spending. Just over half (54 per cent) of Brits make purchases with their credit card and one in five (21 per cent) dip into their authorised overdraft.
The research also found a quarter (26 per cent) of people who have used credit this year have needed it more than previously. Just over one in ten (12 per cent) have had to rely on credit as their budgets have been squeezed.
Kevin Mountford, head of banking at MoneySupermarket said: "When used responsibly, credit is a good thing and a useful tool for families to manage their money. However, with the continued pressure on household finances, it is no surprise consumers are less able to save and resort to credit to tide them over for their day to day spending. Consumers need to understand all the terms and conditions that come with credit products and make sure they have the means to repay the debt in a timely manner. For those who rely on a credit card to pay for day to day expenditure, as well as the big ticket items, it's essential you use the right card for your needs.
"For purchases, using a product like the Tesco Clubcard credit card which offers zero per cent purchases for 16 months, could be a good option to help manage the repayments without incurring interest. If you are able to pay off the full balance each month then using a cashback and reward cards is a no brainer, as you can benefit from a broad range of incentives on offer, including air miles and loyalty club points. If you don't pay off your balance in full then the interest charges will outweigh any cashback benefit, making it pointless having this type of card.
"With some careful budgeting there are ways to free up cash and its essential to regularly review all your outgoings, check you are on the best deals and switch if necessary."
MoneySupermarket has a SmartSearch credit profiling tool to help those looking for the best credit card deals for their circumstances. The tool matches the customer's credit profile against the card they are most likely to be accepted for, but doesn't leave a footprint on their credit file.
Notes to Editors
Opinium Research carried out an online survey of 2,014 UK adults aged 18+ from 17th to 20th August 2012. Results have been weighted to nationally representative data.
1,406 of 2,014 have a credit card (69.8%). The total UK adult population is 49,969,000 (ONS 2010 projections for 2012). 49,969,000 x 69.8% = 34,878,362 (34.9 million)
Of those with a credit card, on average they have £7,436 available credit. Total amount of credit available for UK adults = £7,436 x 34.9 million = 259,516,400,000.00
MoneySupermarket.com compares (at 20th July 2012)
- 102 car insurance providers and 81 home insurance providers
- 11 broadband providers and 18 energy providers
- 32 unsecured loan and 6 secured loan providers
- 60 mortgage lenders and 28 credit card providers
- 67 savings providers and 37 current account providers.
- Over 1,600,000 mobile phone deals
We help our customers to save money on all of their household bills by providing a free, easy to use online service so they can compare a wide range of products in one place and find the product most suited to their needs. Our size means we are able to offer our customers exclusive, market-leading deals, including some they can't even get direct from providers.
By having considerable volumes of informed customers actively looking for products and ready to purchase, we offer our providers an efficient and cost effective customer acquisition solution across all of our channels. This enables our providers to target their marketing spend in an effective and completely measurable way.
Our revenue comes predominantly from fees paid to us by product providers when a customer clicks through to their website and actually applies for or purchases a product. It is a success based marketing fee.
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- We strive to ensure a product cannot be found cheaper by going direct
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