Britain racks up £161m in credit card withdrawal charges

Thursday 16th October 2008

Consumers in Britain build up interest charges worth up to £161 million through withdrawing cash on credit cards, it has emerged.

Research from uSwitch.com found that more than one million people are using cash withdrawn from credit cards to pay for their mortgages, loans and household bills.

The study's findings come as Britons pay £262million in overall interest charges every day and many lose control of their spiralling debt habits, with one person declared insolvent or bankrupt every five minutes, according to statistics released this month by Credit Action.

Some 1.7 million people are planning to use credit cards to fund themselves through Christmas, the study found.

Britons make more than 38 million cash withdrawals using credit cards each year and 69 per cent of people who do so do not realise how much it costs them in interest.

Electricity prices and gas prices could continue to rise into the winter and many Britons could need help as their debt gets out of control.

High prices are being driven by consumer prices index inflation which currently stands at 5.2 per cent - high above the government's target of two per cent.

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