By Eamon QuinnA UK watchdog may recommend removing minimum repayments from credit card statements because it feels it encourages users to build up debt at expensive costs.The Financial Conduct Authority said that it is considering to ‘de-anchor’ the minimum repayment to encourage more people to pay more than the minimum repayments and to stop using credit cards for long-term borrowing.It made the proposals after carrying out research on the way consumers use credit cards.“Given the effects we observed during our testing, we are considering consulting on changing our rules and guidance to mandate the removal of the minimum repayment anchor,” the authority said.“We consider a de-anchoring measure has the potential to increase consumers’ credit card repayments where they can afford to do so while preserving the flexibility of credit cards, which millions of consumers value,” the watchdog said.It said academic studies had previously showed credit … [Read more...] about UK plan for credit cards
Stop paying credit cards
In 2013, the average cardholder had 4.1 credit cards but only 0.1 charge cards, according to the Federal Reserve Bank of Boston. Clearly, most Americans are not clued in when it comes to charge cards. It makes you wonder whether they're missing out -- or whether charge cards just aren't worth it. Image Source: Getty Images. Charge cards vs. credit cards vs. debit cards Does It Build Credit? Does It Offer Fraud Protection? Does It Offer Purchase Protection? Does It Charge Interest? Is There an Annual Fee? Does It Offer Rewards? Debit cards No Sometimes No No No No Credit cards Yes Yes Yes Yes Sometimes Sometimes Charge cards Yes Yes Yes No Usually Yes Charge cards are like a hybrid of debit cards and credit cards. Overall, charge cards are comparable to credit cards, except that charge cards have to be paid off in full each month, whereas credit cards don't. Charge cards also offer the superior protection that makes credit preferable to debit in many circumstances. … [Read more...] about Charge Cards: Better Than Debit and Credit Cards, or a Waste of Money?
BARCLAYCARD will give new credit card customers £20 cashback when they move their debts to one of their balance transfer card. But whilst cashback is always good news, you may want to weigh up whether the deal is worth it before taking the plunge and switching. Credit cards are a great help when it comes to paying for those big purchases - but if the balance has been on it for a while, the chances are you're racking up lots of interest which you may be struggling to pay back. Transferring the debt onto a 0 per cent interest credit card instead means your monthly repayments will be going towards paying off the debt, rather than on interest rates. "If you’re being charged interest on your credit card debts, a balance transfer could help you get a lower interest rate, or give you a break from being charged interest full stop, for a set period by moving what you owe to a new card," says Martin Lane, from money.co.uk. The cashback offer on the Barclaycard is on the Platinum 25 … [Read more...] about Barclaycard will PAY you to transfer debts to balance transfer credit card – but is it any good?
The first credit card to charge a flat fee rather than a rate of interest has launched, aimed at those struggling to build a credit score. The card, from 118 118 Money, has a tiered monthly charge depending on the credit limit, but does not have other charges such as late payment or returned payment fees. Unusually for a credit card, there are also no fees to withdraw cash. It costs £8 a month for a £250 credit limit, £14 a month for a £500 credit limit and £17 a month for a £1,200 credit limit. As customers' credit ratings improve, they are offered higher limits. Whether or not this represents a good option depends on the situation. Someone borrowing with a £250 credit limit would incur £96 in fees a year, the £500 credit limit option comes with £168 in fees a year and the £1,200 option would cost £204 in fees a year. This is less than, or equivalent to, paying the level of interest on a regular “credit … [Read more...] about The interest-free credit card that costs £168 to borrow £300 – who is it for?
Credit card signatures are now going the way of old-fashioned carbon copy slips: discarded in favor of streamlined transactions. The three major credit card companies will stop requiring signatures on purchases this week, with MasterCard, American Express and Discover relaxing their policies on Friday and Visa set to do so on Saturday. It doesn't mean that you won't be asked to sign receipts ever again, but the change is likely to result in fewer of your John Hancocks landing on the dotted line. The reason for the change is due to technology and changing consumer habits. In an October blog post about the pending changes, MasterCard said that more than 4 out of 5 transactions in North America didn't require a signature at checkout. Getting rid of the signature requirement "is another step in the digital evolution of payment and payment security," MasterCard executive vice president Linda Kirkpatrick wrote in the blog post. Investing in other ways to combat fraud That … [Read more...] about Why credit card signature requirements are now a thing of the past