Sainsburys Bank would like credit card deals made easier to understand to help customers find the best option to suit them.
A study carried out by Sainsburys Bank found that over half of credit card holders have access to a reward scheme, though less than a quarter of them have actually claimed any of the rewards. This figure is made worse when it is considered that the number of credit cards offering rewards has gone up to 190, from just over 120 three years ago.
The people who responded to the Sainsburys Bank survey gave the main reason for not claiming rewards on their credit cards as it just not being worth it. Over 40 percent of people claimed that the effort needed to get the reward simply was not worth it.
The worldwide credit squeeze is beginning to affect UK borrowers now, with holders of MBNA credit cards seeing interest rates climbing.
It seems that MBNA are trying to recover their losses in other markets by really pressing credit card clients, in some instances simply doubling the interest rate payable and then levying additional payments when accounts have got into difficulties.
The bottom line is that banks like MBNA can do whatever they choose with interest rates when they are classed as variable, which all credit cards are. Right now it looks like the UK borrowers are paying for the difficulties in the USA, literally. A typical example is of a lady who had never missed a payment and was what would be categorised as an excellent credit risk. Her rate went up within a couple of months from just under 16 percent to almost 28 percent. Knowing someone has the means to manage their credit and will pay the extra cost is no justification for doing so.
An American Express survey has shown that identity theft is more of a worry to people now than many physical attacks.
Over half the people surveyed by American Express worry that they will have their identity used by someone else, with the biggest increase being amongst the 18 to 24 year olds, with the concern up by 8 percent compared with last year. Costing over GBP1.3 billion each year identity theft is a very real crime and as our use of chip and pin cards, the internet and technology increases so do the chances of our personal data being taken.
In reality the risk is relatively low, growing lower still if simple precautions are taken. American Express advise internet users not to provide their details to any sites they do not trust, to shred their documents before disposing of them and to make sure their computers are password protected, and not with either birthday or mothers maiden name, which are by far the most common ones used.
