Consumers encouraged to cut credit card spending

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Consumers encouraged to cut credit card spending

Tue 29th Jan 2008

Brits are being advised not to leave it up to their banks to monitor whether they are borrowing at a sustainable level.

One in seven cardholders have been given additional borrowing facilities in recent months, according to Fool.co.uk. Among 18 to 25-year-olds that figure rises to one in two, many of whom report boosts to their spending power of up to 50 per cent.

That means the demographic most commonly associated with irresponsible borrowing is in fact being invited to spend more than ever before, raising concerns that banks are sending mixed messages and prompting Fool.co.uk to urge consumers to take control themselves.

"On the one hand, they are slashing credit limits to older consumers who have become accustomed to credit," said David Kuo, head of personal finance at Fool.co.uk. "But on the other hand, they are increasing credit limits for younger consumers at a time when we need to practice greater financial discipline."

MoneyFacts.co.uk recently published research showing that the average cardholder with a £2,500 balance could save some £325 per year by shopping around for a better deal.

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