Research by TotallyMoney, a UK credit comparison site, has warned consumers against viewing 0% balance transfer deals as unconditionally good deals.

Barclays’ release of Barclaycard Platinum, a credit card offering the UK’s longest transfer deal (30 months), sparked enthusiasm in a market buoyed by rising consumer credit borrowing.

Go deeper with GlobalData

Data Insights

The gold standard of business intelligence.

Find out more

But with recent figures revealing over a fifth of British consumers in 2013, up from 17% in 2012, intend to borrow money for their Christmas spending, and 15% relying on credit cards to do so, TotallyMoney is warning against unchecked borrowing.

The website’s research found that one in four users of long term balance transfer deals had missed a monthly repayment, often leading to a loss of the 0% balance transfer before the end of the offer, as well as a negative impact on their credit rating.

TotallyMoney reported: "Across the credit card market, a total of 7.3m (24%) credit card holders admit to missing credit card payments in the last two years."

The report also found that ‘more than one in five consumers (22%) hold a balance transfer credit card with an average balance transfer of £2,167.

How well do you really know your competitors?

Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.

Company Profile – free sample

Thank you!

Your download email will arrive shortly

Not ready to buy yet? Download a free sample

We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below form

By GlobalData
Visit our Privacy Policy for more information about our services, how we may use, process and share your personal data, including information of your rights in respect of your personal data and how you can unsubscribe from future marketing communications. Our services are intended for corporate subscribers and you warrant that the email address submitted is your corporate email address.

"With more than 6.5m balance transfer credit card holders, just 33% of these have a direct debit in place to ensure they never miss a monthly payment."

With the default purchase APR totalling at 18%, it concluded, the longest deal may not always be the best.

 

Related articles:

Russia’s Trust Bank records rise in banking card loan growth rate

Barclays credit card has longest-ever balance transfer

Not-so-festive season for Indian card issuers