At the height of the UK economy, just prior to the credit crunch, the amount of junk mail received by each and every household in the UK seemed to be never-ending with credit card applications, loan offers and mortgages all apparently on tap. However, over the last 2 to 3 years there has been a significant fall in the amount of financial junk mail due to a mixture of tighter regulations and a newfound risk aversion strategy implemented by many financial companies.
While the vast majority of us are well aware that our credit ratings are checked for each and every financial application we make, why do credit card companies and other financial institutions need to check your credit rating?
A large number of MPs have signed a petition within the Houses of Parliament trying to force the authorities into agreeing to give each and every MP a UK taxpayer-funded credit card. While on the surface this would again seem to be some kind of joke, and look as though MPs have totally missed the reason for public disdain against expenses, maybe it is not as crazy as it seems?
One subject that many people may be considering at the moment is the transfer of their credit card balances to a new credit card in order to take advantage of the many 0% balance transfer offers available. So how does a credit card balance transfer work?
As you might expect given a recession, the UK credit card industry is continuing to struggle with more and more people taking a sensible approach to the finances and resisting the temptation to rack up yet more debt. Datamonitor has issued a report suggesting that the UK credit card market will fall by 2.7% this year before returning to the growth path with an increase in use of 2.5% in 2011.
Since the credit crunch began many people have been struggling to pay their credit card bills on a monthly basis and indeed many are now starting to fall behind with their payments. So what can you do if you start to struggle with your credit card bill?
The British Retail Consortium (BRC) has today come out in support of UK retailers who believe that "unjustifiably high" fees on credit and debit card sales are impacting upon their competitiveness. The BRC estimates that a credit card transaction costs UK retailers 34p, debit card transactions 8.5p and cash transactions 2.1p. As a consequence additional costs of around £480 million are being taken from the economy with 76.7% of all retail spending carried out using some form of card.
More and more people are now looking towards the prepaid credit card market as a means of increasing their options regarding easy payment. However, experts believe that as we approach the summer period many consumers are taking advantage of the ability to avoid "high booking fees" with some low-cost airlines by using prepaid credit cards. There's also a feeling that the ongoing influx of immigrants into the UK, who are unlikely to have access to bank accounts immediately, is feeding demand for prepaid credit cards for online shopping and easy payment of goods in shops.
When Barclaycard acquired Goldfish back in 2008 the Goldfish credit card offered one of the most generous perk schemes on the market at the time. However, Barclaycard has recently adjusted the perks attached to the Goldfish credit card and customers will receive just 0.3% cash back as opposed to 1% in days gone by. Despite rumours in the marketplace that Barclaycard may well be looking to "kill off" the Goldfish credit card the company has denied this and reaffirmed the low interest rates attached to the card in relation to outstanding balances.
It seems that more and more people in the UK are happy to use their credit cards to fund everyday expenditure despite the fact that the economy is still on something of a knife edge. Whether a large number of UK consumers are "burying their heads in the sand" is open to debate but the truth is that the UK economic revival is anything but certain and many believe the UK is actually on the verge of falling back into a double dip recession.
