26 October 2007
Building society Nationwide warned British consumers yesterday that store cards offered by big retailers can hold a hidden financial sting.
Although attractive to shoppers through heavily-advertised introductory offers such as 10% discount at point of purchase, the financial services firm said that a little pre-planning on money matters is a more effective way of saving money than picking up a store card.
Nationwide also pointed out that many store cards charge double the average APR of mainstream credit cards - with both Burton and Dorothy Perkins offering an astonishing 29% rate.
Jeremy Wood, divisional director at Nationwide, said: "Although store card introductory offers look great at face value, borrowers who are unable to clear their balances each month could find that they are paying over the odds."
Figures from the building society show that £2 billion was spent on store cards in Britain last year.
Worryingly, around half of the cards' customers incurred interest charges, with many finding themselves paying back a potentially ruinous rate.
© 2008 Adfero Ltd
Content for the uSwitch.com market news service is provided by a third party, Adfero Ltd. Whilst uSwitch.com makes reasonable efforts to check the reliability of this content, uSwitch.com does not guarantee the accuracy thereof or endorse the views or opinions given by Adfero Ltd, unless expressly stated otherwise.