Online shoppers may want to consider using a credit card when buying expensive Christmas presents to ensure that their purchases are protected under Section 75 of the Consumer Credit Act, which protects items valued £100 to £30,000.
Under Section 75 the credit card company and retailer are both liable for any breach of contract or misrepresentation of the retailer, which makes it easier for consumers to apply for a refund if the products they have purchased do not meet the terms of the contract, for example they do not receive the product they purchased.
Although shopping on a credit card provides consumers with some extra protection when making purchases online and in-store, it is important to remember that credit card debt can quickly mount up, especially when interest is added, leaving consumers with a significant amount of post-Christmas debt.
One option available to consumers that can make managing credit card debt easier is a 0% purchase credit card. These cards provide an interest-free period on purchases, which means that no interest will be added to the debt on items bought during this period.
Over the past week, a number of credit card providers, including Barclaycard, NatWest and Royal Bank of Scotland, have increased the interest-free period on their 0% purchase credit cards.
For example, last week Barclaycard increased the interest-free period on its Platinum All-Rounder Visa by one month to now offer 0% interest on purchases for 22 months. This card is available to those aged 21 and over who earn a minimum of £20,000. After the interest-free period ends, it charges 21.9% APR.
NatWest, Royal Bank of Scotland and Ulster Bank also increased the interest-free period on their respective Purchase & Balance Transfer Credit Card Mastercard last week. All these cards now offer an interest-free period of 22 months, an increase from their previous 0% interest period of 20 months. The cards are available to those aged a minimum of 18, who earn at least £10,000 and who have a current account, savings account, credit card or mortgage with the bank. They charge 21.9% APR once the interest-free period ends.
Currently, the only card offering an interest-free term longer than 22 months on its 0% purchase credit card is Tesco Bank with its Clubcard Credit Card Purchases Mastercard. This card has an interest-free term of 23 months and is available to those aged 18 and over who earn a minimum of £5,000. After the interest-free period ends, it charges 20.9% APR.