Summary
Billions of us use shop cards but are they aware of the shocking levels of interest they demand? This article tells you how the cards perform and gives some very valuable advice.

We will begin by telling the truth, we’re not tremdous admirers of shop credit cards. However, there are approximately 11 million store credit card holders with outstanding balances of above 4 billion pounds. And some sixtyfive retailers manage shop cards, mostly department stores, large DIY retailers and clothing retailers.

Shop cards, are a branded credit card which can only be used in the appropriate chain or correct shop. Traditionally they are the most pricey source of credit, charging up to and over 35 per cent interest per annum. That is much higher than the average high street bank credit card. Since the normal shop card balance is around 800 pounds, that would that would cost card holders 270 pounds a per annum simply in interest. That kind of cost can easily mount up becoming an uncontrollable debt .

Taking the positive side of store cards, they they can be handy as the retailers often promote them with discounts off the items purchased on the card and they might also provide a longer interest free period. Clients may also get particular or sale offers sent to them in the post or be informed of new merchandise ahead of other customers.

On the negative side, danger awaits those who are clearly tempted by ”interest-free”, “nothing to pay for six months” or discounts offers particularly those who may already be struggling with their debt . These card holders may be using the store cards for the reason that they have not got the money to pay the full amount now and they are living in hope that things will improve soon. This just isn’t a good plan!
Retailers also need to be anxious about forceful sales people promoting shop credit cards to clients who have little understanding about how to control their use of the card. In our opinion, it is all too easy to be persuaded to sign up to a store card, but unless you pay off the whole amount within the interest-free time these cards are an extremely costly way of obtaining credit .
We recognise that the cards can be very attractive in order to get a discount on your shopping bill.

Nonetheless, it remains all to easy for debts on your store credit card to grow rapidly out of control.
So, as a rule we recommend keep away from store cards unless you are very confident} that you will pay off the full amount the minute the store card bill arrives.

Debt advisers are relentlessly lobbying the financial regulators to raise interest rate warnings. They believe that statements for store cards should include a coloured underlined warning showing their APR interest rate and what the card holder will have to pay if just the minimum payment is made.

Consequently if you do decide to consent to a shop card be very certain how much it will cost you. We concede that many British shoppers find store cards to be a tempting way to get big savings on their shopping. But please, let us recap, always promptly pay off the total balance every month. That way you’ll avoid the store card debt trap