When was the last time you paid a credit card fee?
Recent research from a leading consumer website has found that British credit card holders are wasting £150 million every year in unnecessary ‘late payment’ fees. With card late fees averaging £12, making payments after the deadline can result in charges as well as potentially damaging your credit rating.
Over half of credit card holders don’t have a direct debit to make the minimum payment
The research found that 57 per cent of credit card holders in the UK don’t have a direct debit set up on their card. A direct debit ensures that the minimum card payment is made every month and so not having one means you run the risk of missing a payment.
The survey also revealed that 26 per cent of credit card holders have been charged at least once in the last year for missing a minimum payment whilst a further 8 per cent have been charged three or more times in the last 12 months. 1.2 per cent of card holders have been charged ten or more times in the last year, racking up over £120 of charges in the process.
Late payments can also cost you your promotional credit card interest rate
Chris Griffiths, head of credit cards at Confused.com, said: “Setting up a direct debit to make a minimum payment on a credit card is such a simple thing to do, yet well over half of credit card holders haven’t done it. Collectively we are wasting millions of pounds each year on these charges.
“As well as late payment charges, many credit card holders are likely to have lost out on attractive low interest introductory deals or rewards as well, as these deals are often withdrawn if minimum payments aren’t met. Missing minimum payments can also adversely affect customer’s credit profiles, which may be detrimental when they want to borrow in the future.
“We would encourage anyone without a direct debit set up to get one in place.”
