When it comes to comparing credit cards, it’s best to always shop around because credit nowadays can be expensive and if you’re not careful, then you could be paying over the odds for what is a competitive financial product.

There are a huge number of credit cards out there all vying for your business and the best way to get a handle on what’s on offer is to use a good credit card comparison site.

And without a good credit card comparison site, it is very difficult to find the deal that best suits you, not only in terms of interest you’re paying on the money you might ‘borrow’ on the card, but also in terms of its flexibility.

Also, it’s best to be aware that each card has particular strengths and weaknesses, which means it is worth matching a card with your particular purchasing profile, so as to get the best deal out there.

So a good credit card comparison website will make that search so much easier for you and categorise cards in terms of their strengths. For example, up first in any comparison list should be the top cards, the ones that not only are good in terms of money, but also have a few other goodies attached as well.

Next category often features those cards which offer good balance transfer deals. This is a key starting point for those wishing to compare credit cards. If a card won’t give you a good deal on a balance transfer, then ignore it. What you’re after here is a low-rate incentive to get you to move and then some more goodies thrown in (such as purchase protection schemes).

Then the comparison site might look at those cards which give the best rates when it comes to purchasing goods, a good thing to consider if you intend to hammer your credit card.

Further categories might include those cards that offer rewards, are geared towards travel offers, or standard rates. A upmarket section is usually included, as Platinum cards tend to cost more, but do have added incentives attached. Business cards for those that need that facility are also usually included and an interesting category, and on highly relevant in today’s straightened times, are Credit Builder cards.

These are geared towards people with a less than perfect credit history who want to demonstrate that they can use a credit card sensibly again over a period of time. The downside with these cars of course are high interest rates and low amounts of credit on offer, but they can make all the difference to someone who needs to prove they are financial viable again.

A more advanced search will look at particular needs, including 0% balance transfers; no balance transfer fees; purchase incentives; low interest rates; no annual fees; high credit limit; 0% charges of foreign currency transfers; and, cashback deals.

And once you have decided upon your personal parameters, you then get down to the business of comparing. A good search engine for comparing credit cards should give you the name of the provider (Barclays, HSBC etc); the rate offered on balance transfers (plus the length of that rate); same with the purchase incentives; the typical variable Annual Percentage Rate, or APR as its known; and, any benefits that the card might have.

Armed with all that, you will then be able to make a sound decision when it comes to comparing credit cards.

Guest Article by Neil Camp

Barclaycard has announced that spending on credit and debit cards was up over the 2009 festive period.

Barclay Payment Acceptance, which is one of the largest processors of credit and debit card transactions, said that UK shoppers spent more using their plastic than they did last time. The figures compare 19th December to 31st December, 2009, to the same period in 2008.

And the busiest day turns out to be the 23rd December, when a whopping £497 million was spent using credit and debit cards. Further examination of the data might show of course that this was men doing their last minute shopping.

The next busiest day was 29th December when no doubt attention turned to sale bargains. On this day some £376 million was passed through the tills using plastic.

The total turnover for the period under review was a quite staggering £4 billion, not bad considering the country is still officially in recession. It was a 2.4% increase over 2008 which saw just shy of four billion being spent.

Breaking the data even further, reveals that spending after Christmas was also up from 2008, with £1.68 billion compared to £1.64 billion.

On Christmas Day itself (thought that was a holiday), there were 700,000 transactions totalling £24 million. These appeared to peak at 12.08pm (maybe in readiness for lunch and the Queen’s Speech), with 32 transactions a second. The online retailers accounted for £9.5 million’s worth of trades on the day itself, compared to £8.1 million in 2008 (up 17%).

On boxing day, many of the transactions, which averaged around £73, were driven by the DIY sector.

Head of Sales at Barclaycard Global Payment Acceptance, Marc Pettican, said:
“Our retailers have seen an increase in turnover compared to the same period last year with over £4 billion being spent. We’ve also seen a stronger post-Christmas performance as shoppers take advantage of the sales discounts and consider the effects of the imminent VAT increase.”

Guest Article by Neil Camp

A top comparison website has revealed a dubious distinction for the inhabitants of Yorkshire: that it’s the UK region most likely to struggle when it comes to meeting credit card payments.

The good folk at confused.com have risked the wrath of those living in God’s promised land by saying that in the UK, the closure of one in five accounts by the provider was due to non-payment. And Yorkshire residents exceed the national average by 13%, with 35% of accounts closed by the provider due to repayment failure.

But before thoughts of bringing out that old hackneyed debate about the north and south divide, the research also reveals that the North East is best at repaying with only 8% having their accounts closed for not meeting monthly payments. And, a close second to Yorkshire is the South East, 33% of which have suffered the same penalty. Incidentally, alongside the North East’s exemplary residents were the people of east Anglia, who also only had 8% of defaulters.

Head of credit cards at Confused.com, Joanne Garcia, said:
“Credit card users in all regions need to understand how damaging it can be to miss repayments. While it may not seem like a big deal to miss a few payments here and there, credit providers – which include mortgage lenders – leave no stone unturned when it comes to checking a person’s credit worthiness. It they see a history of non-payments it makes it much more difficult to borrow money.

The research at confused.com, which is owned by the Admiral Group plc don’t say how many people they asked, or how they got their figures, but it is hoped that they have done their homework about the Yorkshire figures. Although confused.com should know what it’s talking about of course, as it generates over one million quotes per month. From its origins in 2002, it has expanded its range of comparison products to include car insurance, home insurance, travel insurance, pet insurance, van insurance, motorbike insurance, breakdown cover and energy suppliers, together with financial services products such as credit cards, loans, mortgages and life insurance.

Guest Article by Neil Camp 

A large number of small businesses are having to rely on corporate credit cards to fund their businesses as banks continue not to offer traditional business loans.

It’s a worrying trend in the US, but one which could be repeated throughout the UK as banks rely on the greater interest gained on corporate credit card use to protect their positions.

Figures from across the pond suggest that US banks are lending around £8 billion less at the moment and suggesting instead that their customers choose their costlier corporate credit cards. Other figures show that business loans between $100,000 and £1 million were down nearly a quarter in 2008. Furthermore, studies have revealed that well over half of small business proprietors had raised business capital using a credit card.

And business leaders are unhappy, stating that credit cards are not only far more expensive, but are more rigid in their terms. And obviously, they offer no sense of advice, or help, that a business person might have usually received from a corporate banking advisor.

Small business owners are furious that a banking system, bailed out by tax payers money both in the US and in the UK, is apparently using that money to shore up their own finances and not pass it along into the greater economy.

And with many experts believing that renewed confidence from both the consumer and small industry is the only way out of recession, it would appear that banks are not playing ball.

Guest Article by Neil Camp 

According to Financial Fraud Action UK, the snappy title of the body known as the voice of the industry for financial fraud matters (previously known by a worse non-de-plume, APACS3), says its latest report paints a picture of first the good news, then the bad.

The findings, drawn up in conjunction with The UK Cards Association and the Cheque and Credit Clearing Company, show that card fraud losses are down 23% to £232.8m in first half of 2009 (compared with same period last year); there’s been a first ever fall in card-not-present fraud losses; and, cheque fraud losses down 26% to £15.6m.

The bad news comes in the online banking fraud losses which show a rise of 55% to £39m.

The actual fraud to turnover rate on debit and credit cards amounted to 0.1% in the first half of 2009, meaning that only around a tenth of a penny is lost to fraud in every £1 spent on cards.

Katy Worobec, Head of Fraud Control, said:
“These latest fraud figures are good news but we know there’s no room for complacency. Whilst industry online security initiatives such as Verified by Visa and MasterCard SecureCode may be making their presence felt, the fraudsters are never going to shut up shop and, of course, there are emerging areas such as online banking fraud which has risen again.

“Although it’s difficult to prove, we think that one of the reasons for this dip in card losses may simply be as a result of fraudsters realising that they can prosper more by targeting foreign-issued cards – particularly those without chip and PIN protection and which currently have stronger currencies than sterling. The fact that we’ve seen a 36% increase in the first half of this year in the amount of fraud being committed on foreign issued cards here in the UK adds some weight to this theory.”

Helping the successful trend was a special police unit sponsored by the banking industry to stamp out organised card and cheque fraud across the UK. Known by the initials DCPCU, the Dedicated Cheque and Plastic Crime Unit is believed to have helped save around £13 millions of fraud in just the first six months of the year. This is in addition to the £315 million in fraud savings to the industry as a result of the DCPCU’s work since its launch back in 2002.

Other factors of course have also played a part, not least Chip and PIN which say Financial Fraud Action UK has undoubtedly continued to make it more difficult for fraudsters to commit fraud on our cards in the UK. This has resulted in losses at UK retailers down by 26% from the same period last year. Mail non-receipt fraud fell by 33%, and lost and stolen card fraud is down by 6%, its lowest level since 1991 when the industry collation of fraud losses began. Furthermore, the banking industry is continuing to work closely with retailers to raise awareness of the ways in which retailers can protect their Chip and PIN terminals from criminals.

The growth in the use of MasterCard SecureCode and Verified by Visa (online payment systems that make cards more secure when shopping on the internet), by both online retailers and cardholders has helped cut losses from phone, internet and mail order shopping fraud. They have fallen for the first time ever and now stand at £134 million. Another reason for this drop has been the increasing use of sophisticated fraud screening detection tools by retailers and banks.

Fraud abroad has also dropped, mainly because financial institutions are now more aware of unusual spending habits, which means a transaction is refused before it potentially becomes a fraudulent act.

A decline in the use of the cheque was one main reason why such fraud losses during January to June 2009 decreased from £21.2 million to £15.6 million, a drop of 26%. The majority of fraudulent cheque payments get stopped when the cheque is paid, thanks also to the financial industry’s tighter controls.

In amongst the general back slapping there was a bit of bad news, with a 55% rise in online banking fraud losses which totalled £39.0 million during the six months to June 2009.

This increase is due to criminals employing more sophisticated methods to target online banking customers through malware attacks. These target not the financial institutions’ own systems (far more difficult to broach nowadays), but go for the weak part in the chain, the customer. And there has also been more than 26,000 phishing incidents (bogus emails seeking personal details for fraudulent use) during January to June 2009. This represents a 26 per cent increase on the amount seen in the same period last year.

The financial industry, say the Financial Fraud Action UK, continues to do its utmost to raise awareness about the importance of having up-to-date anti-virus and anti-spyware software. It is working with PCeU – the Metropolitan Police Service Police Central e-Crime Unit – which was established to co-ordinate the law enforcement approach to all types of e-crime. It also provides a national investigative capability for the most serious e-crime incidents.

Guest Article by Neil Camp

Two companies have waded in with similar credit card application success checkers.

Both Barclaycard and confused.com have introduce services which not only speed up the process of applying for a new credit card, but also quickly assess the likelihood of a successful application.

Barclay claim that they have created a unique online eligibility test which is designed to help potential customers find out if their credit card application is likely to be successful, or fail at the first hurdle.

This does away with the need to complete application forms, if the application is likely to be met with the waste bin. It will only leave a search ‘footprint’ on a person’s credit record, as it isn’t a formal application for credit, and will not affect their ability to get credit in the future.

And it’s the minimal use of force on a person’s credit record, that Barclaycard is heavily promoting.

Amer Sajed, chief executive of Barclaycard UK, chirruped:
“Consumers currently need to apply in full for a credit card UK, without knowing whether they are likely to be accepted or not, leaving a search on their credit file which can potentially have a negative impact on their credit rating. This unique pre-application check solves this problem. The check can be completed in a few minutes and gives consumers a good indication of whether their application will be accepted.”

The service is available via the Barclaycard website. The company claim that since its launch, 4000 potential customers have used the pre-application check to determine whether they would be accepted for a Barclaycard, giving them a better idea of whether or not they would be successful in an application for a credit card.

In a similar effort to win the hearts and minds of those desperate for some plastic money, confused.com has launched a new credit profiling tool. It basically enables customers to see how likely they are to be accepted for the credit cards offered on its site. Confused.com state they are the first price comparison site to offer such a service which, as well as being free to use, leaves no credit check footprint.

Joanne Garcia, Head of Credit Cards at Confused.com, said:
“Now is the time to take control over your debts. It’s sensible to start by paying off the most expensive debt first, so don’t waste this opportunity to get rid of those costly credit cards. Switching to a cheaper credit card and/or paying back just a small extra amount each month can be really effective, especially if you are currently paying off just the minimum each month.

“But as the rules around lending get more stringent, trying to switch credit cards can be a time-consuming and frustrating exercise. The tool on our site will give customers the confidence that they are applying for the right product which should save them both time and incurring unnecessary credit footprints.

“If you can’t switch to a cheaper credit card, you can still make staggering overall savings by making more than the minimum repayment every month.

“For example, if you have a credit card debt of £5,000 on a standard rate of 14.9% and pay back the minimum of 2% each month, it could take 36 years to pay it back and you’d pay nearly £7,000 in additional interest. By paying just an extra £10 a month, the debt would be repaid in just over 16 years, and the additional interest paid would be a far less eye watering £4,200. If you could stretch to paying off an extra £50 per month, it would take just six years to repay the original debt, plus just under £2,000 in interest.”

Guest Article by Neil Camp

It has been revealed that over eight million adults have given their chip and PIN details to someone else to make a purchase on their behalf, or get money from a cash machine for them, threatening the very viability of the system.

And of eight million people sharing such details, an alarming 24% have fallen victim to fraud.

The figures come from research by insurance company LV= which discovered that one in five UK residents tell friends and family their PIN numbers, leaving themselves open to chip and PIN fraud.

And finance experts have again warmed that such habits not only leave the person vulnerable to fraud, but threaten the credibility of the Chip and PIN system.

They also point out that ID fraudsters can quickly clock up many thousands of pounds of purchases by cloning a card and banks may refuse any kind of refund if the card owner has shared their PIN with others. Banks have a get-out clause in the event of card fraud, if they considered the card user to have acted without reasonable care and attention. Sharing personal security numbers is seen as such a case of acting without due responsibility.

The research revealed that most borrowed cards are lent for the purpose of obtaining cash from ATMs. The findings went on to reveal that almost one in ten (9%) have told someone the details over the phone, 7% have written them down and 6% have given them face to face in a public place.

Businesses should also take their fair share of the blame said the report, as they did not pay enough attention as to who was using the card at the till. This lack of attention meant that may retailers were potentially opening themselves up for huge losses and counter-claims.

John O’Roarke, managing director of LV= home insurance, said: “It’s concerning to see the numbers of card-holders who are so lax with their card details, even if they are sharing them with their friends and family. We would strongly urge all card-users not to tell anyone their PIN number. Not only does it undermine the security of your account and increases the risk of ID fraud but also card holders could end up out of pocket if they are found to have shared their card details.

“We’d urge any customers who think they might have become a victim of identity fraud, to call our Identity Fraud Helpline for help and support.”

Guest Article by Neil Camp

Abbey is in the process of rebranding all of its credit cards. Out will go the name Abbey and in comes the name Santander.

Abbey customers are being informed of the change by letter and also being told that the terms and conditions of their credit cards will remain the same.

Observers see this as further evidence that Santander, which owns Abbey, will gradually replace all the previous branding and corporate identity over the coming years.

To mark the changeover, Santander allowed their credit card holders to use their plastic free of fees when abroad in June and July. Although existing Zero card holders already have such a deal in place.

Guest Article by Neil Camp

In these straightened times, U.K. citizens are turning away from their credit cards and relying more on their debit cards.

So says payments association ‘Apacs’ which reported that the total spent on plastic in the first quarter of 2009 was £94.2 billion, up a total of 5.4%. And the number of purchases was £1.9 billion, up 6.5%. Debit cards were responsible for 74.5% of all plastic card purchases in the first quarter of 2009, up 4% compared to first quarter 2008. In the same period, purchases by credit cards dropped 3%.

The use of cheques fell again, with the number clearing through the system down by just over 10% and their total value falling by 9.4%.

Apacs also reported that automated cash machines (ATM) were doing a roaring trade, with £45 million being withdrawn in the first quarter.

Those financial institutions and individuals using The Faster Payments Service continues to gain in popularity, with the first quarter of 2009 seeing a tad over 60 million payments processed. These payments totalled up to a respectable £20.6 billion.

Since the launch of The Faster Payment System in May 2008, which is designed to speed the processing of money between financial institutions, over £50 billion of payments have been processing, representing 142.9 million payments.

Guest Article by Neil Camp

Financial watchdogs are warning that banks can literally plunder their customer’s bank accounts to settle unpaid bills in other parts of their empire.

Stories are emerging of people hitting financial trouble, not paying their unsecured commitments (mostly credit cards and loans) and keeping their money in their current, or saving accounts for their secured loans such as mortgages. And, unbeknown to the customer, the bank can legally come along and use the money sitting in the current, or savings account, to pay a missed credit card bill, leaving the customer vulnerable to a missed mortgage payment.

And all this is quite legal, going under the term ‘setting off.’ Many will be surprised to hear that banks are perfectly entitled to ‘Set-Off’, or combine accounts, if they think fit. The ‘Set-Off’ clause is written into many loan contracts, and account terms and conditions, and even if it isn’t, then a bank may still have to the right to take such action.

So, for people facing trouble, the advice is to use two completely separate financial institutions in which to hold a current and a savings account. This way, a bank will not be able to play around with a person’s accounts, balancing the books without recourse to their customers’ wishes.

There is an obscure guideline that banks have to let you know if they decide to take such action, especially if the accounts are in joint names, if it’s a swap between different companies within the same group, or involving business accounts. But people shouldn’t rely on this and in the case of a simple current and savings bank account, the bank can seemingly act without any notice at all.

And the banks should certainly not go ahead with such an action if, for some reason, the account and its balance is in dispute. Nor can the bank say grab the whole amount outstanding on the loan, only the amount overdue, but the rules seem blurred in this area. The banks certainly should tell you after they have taken the money from an account to set-of against others, but there’s no rule as to when they should let the customer know.

The Citizens Advice Bureau has reported that there is growing evidence that this Set-Off rule is being increasingly used by banks. Set-of enquiries have risen by a considerable 25% in the past couple of years.

What worries some in the consumer watchdog institutions, is that the banks are going to be get more and more aggressive with how they use the Set-Off rule, with some complaining that this provision gives them carte blanche to unfairly meddle in their customers’ accounts for their own benefit.

For example, it’s predicted that a bank could technically reduce a customer’s account credit card limit by say £200, then use money in the customer’s current account to make good the difference they have just created. An alarming prospect for many.

Of course, given the economic climate, banks should be more sympathetic to their customer’s problems and should not use ‘Set-Off’ without proper consideration of the effects. And people who are being affected, are being strongly advised to complain in writing to their banks, or inform the Financial Ombudsman Service.

Guest Article by Neil Camp