One in six Brits with paperless statements miss credit card payments
One in six (17%) paperless credit card customers have missed payments and incurred unnecessary fines in the last six months****
Problems mastering technology prevents customers accessing their accounts, with almost one in ten (9%) forgetting their password because they check their account online so infrequently
When people do view their statements online, one in five (21%) have found their balance higher than anticipated and one in eight (12%) are confronted with an unexpected bill
As national debt grows to record levels****, com is calling for credit card providers to deliver online and in-app services that would help people better manage their finances.
The shift to online statements has caused confusion amongst credit card customers, with one in six (17%) paperless customers incurring additional fees because of late payments or unexpected interest rates. That’s according to research from Uswitch.com, the price comparison site and switching service.
Paperless billing is the norm for most credit card users, with more than half (52%) now relying on digital updates to manage their account. However, this online-only approach is not always giving customers a clear view of their finances, putting them in danger of making costly slip-ups and falling further into debt.
Problems with the technology are causing real barriers for customers wanting to manage their finances online. A third (33%) of paperless customers said that they have been unable to access their online account, and one in ten (9%) are completely in the dark, admitting that they had forgotten their password because they rarely use their online details.
When customers succeed in logging in, a third (33%) have found their finances in a worse state than expected – with one in five (21%) finding the balance higher and one in eight (12%) being surprised by the date of their next bill.
According to the survey, more than half of credit card customers are signed up to online services, but far fewer have opted to use mobile technology such as smartphone apps. In fact, over half (53%) of paperless customers have never checked their credit card balance through a smartphone app – despite mobile technology playing a pivotal role in other parts of people’s lives. For example, more than four times as many people receive daily mobile notifications from social media apps like Facebook (42%) than from their bank (9%).
Uswitch.com is calling on credit card providers to introduce features that would help online customers stay on top of their finances. For example, half of people (49%) surveyed said that they would like to receive a notification from their credit card app about an upcoming payment being due and three quarters (75%) agreed that notifications of unusual spending would be beneficial.
Tashema Jackson, money expert at Uswitch.com, said: “Credit card providers are missing a trick when it comes to keeping people informed about their finances. With consumers’ lives busier than ever, a helpful nudge from their credit card app would go a long way towards keeping them in control of their finances.
“Useful reminders at financial pinch-points, such as when a bill is due, could help people manage their finances in a responsible manner. Otherwise, many risk missing out on critical information that could prevent them incurring unnecessary fees and potentially damaging their credit file.”
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Rory Stoves
Phone: 020 3872 5613
Email: rory.stoves@uswitch.com
Twitter: @UswitchPR
Notes to editors
Research carried out by 3Gem between 27th June 2016 and 29th June 2016 amongst a sample of 2,000 adults who own a credit card and a smartphone in the UK.
Taking the sample from Q2 of credit card users who do not receive paper statements when asked, ‘Have you experienced any of the following when you checked your credit card bill in the last 6 months?’, 6.4% answered ‘I had missed a payment and incurred a late payment fee‘, 6.8% answered ‘I had incurred unexpected interest/fee‘, 4.2% answered ‘I had incurred interest/fees that were higher than I anticipated‘. 6.4%+6.8%+4.2%=17.4%
Taking the sample from Q2 of credit card users who do not receive paper statements, when asked, ‘Which of the following statements, if any, apply to your experience checking your credit card statement online?’, 9.2% answered ‘I can’t remember my log in details because I check my credit card account online so infrequently’
Taking the sample from Q2 of credit card users who do not receive paper statements, when asked, ‘Have you experienced any of the following when you checked your credit card bill in the last 6 months?’,12.1% answered ‘Payment was due sooner than I expected’ and 21.6% answered ‘The balance was higher than I thought’. 12.1%+21.6%=33.7%
Bank of England monthly debt stats last month (June 2016) revealed the amount of credit extended to borrowers, which includes credit cards, personal loans and overdrafts, rose by 9.9% compared with a year earlier. This was the fastest annual rate in more than a decade and up from 9.6% in April. Over the month consumer credit rose by about £200m to £1.5bn in May.
When asked ‘Do you receive paper credit card statements in the post?’, 46.9% responded ‘No – I opted for paperless billing myself’, 3.2% responded ‘No – My credit card provider automatically switched me to paperless billing’, 1.6% responded ‘No – I wasn’t offered the option of paper statements by my credit card provider’. 46.9%+3.2%+1.6%= 51.7%
Taking the sample from Q2 of credit card users who do not receive paper statements, when asked, ‘Which of the following statements, if any, apply to your experience checking your credit card statement online?’, 10.2% answered ‘I’ve been locked out of my credit card account online because I forgot my password and I am waiting for my new password to be sent through’, 13.6% answered ‘I once got locked out of my credit card account online because I forgot my password and it took ages for the new password to be posted to me’, 9.2% answered ‘I can’t remember my log in details because I check my credit card account online so infrequently’. 10.2%+13.6%+9.2%=33%
Taking the sample from Q2 of credit card users who do not receive paper statements, when asked ‘How often do you check your credit card balance using each of the following methods? - App, 42.4% responded ‘I have never checked my credit card balance in this way’ and 10.9% responded ‘I am not able to check my credit card balance in this way (e.g. don’t have online log in details, have opted for paperless billing)’. 42.4%+10.9%=53.3%
Taking the sample from Q2 of credit card users who do not receive paper statements, when asked ‘How often do you typically receive a notification from the following types of app on your smartphone or tablet? 9.4% said they received a banking notification at least once a day. 42.4% said they received a social media notification once a day
Taking the sample from Q2 of credit card users who do not receive paper statements, when asked ‘To what extent do you agree with the following statement: “I would feel more in control of my credit card spending if my credit card provider sent me notifications on my smartphone or tablet notifying me of important information regarding my account e.g. upcoming bill date, any increased spending, estimated interest charges”. 24.2% answered ‘Strongly Agree’ and 24.6% answered ‘Agree’. 24.2%+24.6%=48.8%
Taking the sample from Q2 of credit card users who do not receive paper statements, when asked ‘which of the following notifications would you find most useful from a credit card app?, 75.2% answered ‘Notifications of unusual activity on your credit card’.
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