Moneyfacts.co.uk highlights credit card debt consolidation issue

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Moneyfacts.co.uk highlights credit card debt consolidation issue

Mon 9th Aug 2010

Lenders are still being cautious about who they hand out credit cards to, according to a representative at Moneyfacts.co.uk.

A spokesperson at the firm highlighted how there is still a risk of unemployment for plenty of people in the UK, which makes card providers less receptive to applicants.

She explained that if someone loses their job, the first debt they are likely to default on is their credit card, which is what makes lenders nervous about approving such accounts.

"It is important for card holders to check that they can keep up repayments on their card in the event of a rate increase," noted the spokesperson.

In her view, one of the most important steps a consumer can take is to check their credit rating, as this will give them a good idea as to what they are eligible to borrow.

A recent study by moneysupermarket.com showed that the average interest rate on credit cards is rising, with the figure currently standing at 17.32 per cent.

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