Saturday 4th of December 2010
Brits using credit cards to pay for items may start asking individual voluntary arrangement (IVA) questions after one expert noted the method of payment can lead to a build-up of debt.
Chris Morling, managing director of money.co.uk, said there is "no doubt" that the use of the finance option could push people deep into the red if they do not manage their plastic products properly.
There are few exceptions to the standard rate of 15.9 per cent APR that most credit cards start with, he noted, adding: "If you are not paying off your balances each month then debt can accrue at quite a rapid rate."
Mr Morling added that the method of payment can be used to make larger purchases, but an individual doing this should know they will have the money available to make the repayment in the near future.
Research carried out by Sainsbury's Finance found that 25.4 million UK adults now use the finance option to make online purchases on a regular basis.
By Neil Burton
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