Rising levels of dependence on credit cards in the UK : Credit Card Guide

Rising levels of dependence on credit cards in the UK

As a nation of credit lovers, many of us in the UK have become increasingly dependent on credit cards, and a recent report has highlighted this by showing just how an increasing number of people have become more and more dependent on their credit card. Credit cards do offer convenience, ease, and flexibility, but if you don’t use and repay them responsibly you could find yourself facing spiralling debt problems.

The recent research has shown how many of us are using our credit cards to fund our day to day living, but fail to make more than a very modest repayment on the balance each month. Using your credit card regularly is fine, and can even benefit you if you have a rewards based credit card, but only if you repay the balance in full each month and do not incur high interest charges.

Figures show that fewer than fifty percent of us pay off our credit card balances each month, and more of us are using our credit cards to make necessary day to day purchases rather using them for increase convenience, ease, and to earn a little something back from the credit card companies. Those that do repay their balance in full each month get to enjoy interest free credit, convenience, and can even earn rewards or money back from the card company.

Gary Fitton, the Post Office Director of Lending, stated that dependence on credit cards couldn’t be avoided for some people given the time of year. He stated: "Typically January is the time of year when people struggle with their money the most. Many people have over-stretched themselves over the Christmas period and have little choice but to use their credit card in the new year."

Tom Smith
4th February 2008

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