Moneynet.co.uk a financial website has asked customers to steer clear from using expensive credit card cheques in order to settle previous debts, as they are laden with 'catch.'
Moneynet.co.uk said people should be on guard, especially post-Christmas and New Year spending, as bills start pilling up and it is human tendency to get tempted to use card cheques, only to realize later that it was the most expensive option chosen by you.
Cards offered by firms like MBNA, Alliance & Leicester, Abbey, Barclaycard, NatWest, Virgin and Halifax enjoy a two per cent handling charges on card cheques, while some also charge for balance transfers.
Though card companies assure that there is a limit set on two per cent fee, Moneynet.co.uk say it is still huge and the more expensive card can cost you around £35. In fact, the website says, it would turnout to be much cheaper through alternate borrowing.
Another way credit card cheques can prove expensive to people is through APRs, since many firms charge customers for APRs of 20 per and even more at times.
At four times the base rate, consumers may want to think twice before using these cheques, said Moneynet.co.uk chief executive Richard Brown, adding that, And, dont forget, users also forfeit the benefit of the lengthy interest-free periods available on standard credit card spending.
Posted
on : Fri, 25 Mar 2005 00:00 GMT | Credit Cards News
By : Paula Jenkins
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