Expensive credit debt 'should be paid first'

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Expensive credit debt 'should be paid first'

Wed 20th Jan 2010

The most expensive debt on a consumer's credit card should be paid off first, in the opinion of Nationwide.

Following the release of a report by the Department of Business, Innovation and Skills which stated that costly debt repayments should be prioritised, Nationwide has reaffirmed its agreement with this stance.

Using the US CARD Act, which only requires that the part of a payment which goes above the minimum payment level go towards paying off expensive debt, does not go far enough in helping consumers, the institution has stated.

Believing that this penalises the most vulnerable card holders who cannot make larger payments off their debt, Nationwide feels that instead all consumers should have their higher charges covered first.

Worries about debt may be behind Nationwide's recent figures, which revealed that people were putting less money into their savings accounts, with an estimated 25 per cent not making any savings at all.

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