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.
- Where next for NS&I customers? - October 23, 2020
- Fixed rate savings – best buy rates edging upwards - September 17, 2020
- 0% Credit Card Balance Transfer terms on the slide since lockdown - July 13, 2020