Figures reveal significant rise in number of card payments made by consumers

contactless cardData published by UK Finance has revealed that card spending totalled £57.1 billion in June – representing a 7% rise when compared to a year earlier.

1.4 billion card payments were made in June, which constitutes a 12% rise when compared to the same time last year.

Contactless payments accounted for 34% of all card transactions, the data found. Online payments constituted 13% of all transactions.

Spending in the retail sector rose by £19 million during June, to total £26.1 billion. Spending on food and drink increased to £10 billion in June.

Meanwhile, services sector spending rose by £138 million to reach £31 billion.

Richard Koch, Head of Cards at UK Finance, said: ‘Contactless payments accounted for a third of transactions in June, with consumers continuing to use their cards for lower value purchases.

‘While spending recorded a relatively modest monthly growth, the number of transactions rose at a faster rate with some 46 million card purchases made every day.’

credit cardData published by UK Finance has revealed that card spending totalled £57.1 billion in June – representing a 7% rise when compared to a year earlier.

1.4 billion card payments were made in June, which constitutes a 12% rise when compared to the same time last year.

Contactless payments accounted for 34% of all card transactions, the data found. Online payments constituted 13% of all transactions.

Spending in the retail sector rose by £19 million during June, to total £26.1 billion. Spending on food and drink increased to £10 billion in June.

Meanwhile, services sector spending rose by £138 million to reach £31 billion.

Richard Koch, Head of Cards at UK Finance, said: ‘Contactless payments accounted for a third of transactions in June, with consumers continuing to use their cards for lower value purchases.

‘While spending recorded a relatively modest monthly growth, the number of transactions rose at a faster rate with some 46 million card purchases made every day.’

Household debt set to reach ‘record high’ this year, TUC suggests

An analysis published by the Trades Union Congress (TUC) has suggested that unsecured debt per UK household will reach a record high of £13,900 over the course of this year.

Unsecured household debt is set to exceed £15,000 before the end of the next Parliament, the analysis also revealed.

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The rise in household debt may be attributed to stunted wage growth, and reflects the UK’s ‘ongoing living standards crisis,’ said the TUC. It also found that wages in the UK are currently worth £20 per week less than before the financial crisis.

The business group is urging the next government to act urgently to deliver higher wages for UK workers.

Frances O’Grady, General Secretary of the TUC, said: ‘The surge in household debt is putting the economy in the danger zone.

‘We’ve got this problem because wages haven’t recovered. Credit cards and payday loans are helping to prop up household spending for now, but millions of families are running on empty.’

Consumer borrowing soared in last months of 2015, Bank of England figures show

The run-up to Christmas saw the largest rise in consumer borrowing in nearly eight years, according to figures from the Bank of England.

In November 2015 consumers owed a total of £178.2 billion on credit cards and loans, up £1.5 billion on the previous month – the largest rise since February 2008. October had also seen a rise of £1.2 billion.

The figures suggested good news for retailers, as a rise in consumer credit generally indicates increased spending on the high street.

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Office for National Statistics (ONS) figures show that retail sales volumes rose by 5% in November compared with the same month in 2014, helping to provide a boost for UK economic growth.

However, some commenters have expressed concerns about the increase in personal debt levels.

Howard Archer, chief UK economist at IHS Global Insight, stated: ‘The pick-up in unsecured consumer credit to a near eight-year high in November follows on from data from the ONS showing that the household savings ratio dipped to 4.4% in the third quarter of 2015, which was the equal lowest rate since 1963.

‘This will fuel concern that consumers are borrowing more and saving less to finance their spending, which is likely a consequence of relatively high consumer confidence and extended low interest rates.’

The Bank of England figures mean that the average person in the UK now has borrowings of £2,759, not including mortgage debts.

Balance transfer credit card deals subject to fees, warns consumer group

Many borrowers could face paying additional fees on balance transfer credit card deals after being tempted by 0% interest offers, a consumer group has warned.

Such deals allow people to transfer old debts onto new cards.

Consumer group Which? estimates that around £334 million is paid in fees to do so each year – but few actually understand the costs that are involved.

In a survey conducted by the group, it was revealed that seven out of ten people incorrectly believed that the transfer was free.

Which? stated that the City watchdog should be made to rule on whether the fee should be displayed as a monetary sum rather than as a percentage.

The watchdog could even consider banning firms from advertising 0% deals when, in actuality, there is a fee attached.

The survey revealed that many consumers were blinded by interest rates on this debt – failing to realise that some deals were more expensive due to having fees attached to them.

Richard Lloyd, Which? executive director, said: ‘Too many credit card deals appear to include sneaky fees designed to catch customers out.’

‘With millions now using credit cards to pay for essentials, it’s vital that the Financial Conduct Authority takes action to ensure consumers are well protected.’

‘We want the regulator to scrutinise balance transfer deals and make it easier for people to understand their true cost.’

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