Total UK credit card balances up again as borrowers continue to make the most of 0% balance transfers

The latest figures from UK Finance (formerly the British Bankers Association) show that total UK credit card balances stood at £64.3 billion as at June 2017.

That’s an increase of £1.12 billion in the last month and more than £2 billion in the last quarter.

Activity in the balance transfer sector of the market shows no signs of slowing down with a further 594,000 transfers totalling £1.31 billion taking place in June alone. That makes the average balance transfer £2213.

Astonishingly 44.7% of total credit card borrowing is interest free that’s £28.7 billion that UK consumers are borrowing and not (yet)) paying interest on.

If that £28.7 billion debt pile was charged interest at a typical 19% APR the annual cost would be £5.45 billion.

There has been a definite slowdown in the 0% balance transfer market where competition has seemingly subsided.

The 43 month deals seen at the turn of the year are now long gone and may end up being a tide mark that’s not breached again for many years (if at all).

The longest 0% deals on offer at the moment are 41 months via MBNA (BT fee 2.79%), Virgin Money (BT fee 3%) and AA and Post Office Money (Both with BT fee of 3.25%).

If you are looking to switch your existing balance to a new card it’s probably best to act sooner rather than later as lenders are already tightening criteria and shortening the length of their interest free offers.

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