According to new research, British consumers could stand to save around 1/5 of a billion pounds each year, if they spent a little more time researching their chosen form of personal credit.
The study revealed that around 1 in every 2.3 borrowers will instinctively choose a credit card, when applying for credit. However, very few consumers realise that credit cards can often be the more expensive way to borrow.
Surprisingly, around 62% of credit card borrowers are unaware of their cards exact annual percentage rate, with an additional 31% flabbergasted to learn that the average card carries an APR of around 19% (theirs included).
Card users are also becoming victim to excessive interest charges, due to haphazard spending such as using their card to make small purchases, when cash would have been just as accessible.
Money management experts have suggested that borrowers should always consider all their options before taking the plunge. In the majority of circumstances loans, and in particular secured loans, can present a far cheaper borrowing alternative for consumers.
In addition, the credit market has become extremely competitive of late and as a result, lenders are offering some fantastic deals. It is wise for borrowers to always shop around before they even consider a form of personal credit, and if possible, seek professional, impartial advice before they commit.
