Credit card spending falls

Category: Credit cards
Date: 6/24/2009

Almost half of consumers are cutting the amount they spend on their credit cards by almost £100 a month in an attempt to cut the size of their outstanding balances.

Forty-four per cent of the nation's credit card holders, which equates to some 14.6 million people, are making attempts to reduce their spending on their cards, according to Tescocompare.com.

On average, consumers have managed to cut their balance by £386 to £2,333. One in three cited reducing debt as their main motivation; a quarter plans to use the cuts to increase their savings; and a fifth wants to reduce their reliance on credit spending.

There are approximately 5.5 million people that have not managed to cut the amount they put on their credit cards as of yet, but who fully intend to do so in the future.

"In the current climate it's encouraging to see so many consumers taking significant steps to reduce their reliance on credit," said spokesperson, Debra Williams.

"Even those who aren't currently in a position to make cutbacks could still save themselves some cash by shopping around for a better deal."

However, while many are making attempts to use their plastic in a thriftier manner, one in three consumers has no intention of reducing the amount they use their credit cards.

Nearly five million have seen their outstanding balances actually go up, rising by an average sum of £412 in the last six months. Of them, 2.3 million said they could not keep up their current standard of life without credit, while one in ten fear they would be unable to manage their finances without the aid of cards.