ATM’s and Cards cost the consumer…Big!
New data, released by the Consumer Credit Council suggests that credit card withdrawals are one of the most common ways for consumers to amass high-end personal debts.
Accordingly, people who actively use their credit cards as a means to withdraw cash from ATM’s have created a market worth around £8.5 billion per annum. However, it is also worth noting that a staggering 40% of this figure is made up from interest and charges.
As a common example, the average cardholder who uses his or her card to withdraw £30 from an ATM, can expect that sum to grow to around £70 over a 12-month period as a result of accumulative interest.
Commenting on the figures, one industry expert suggested that very few consumers appear to be aware of just how expensive this type of borrowing can actually be. He further commented that for every pound withdrawn from an ATM, the borrower should expect to pay around 25% in interest. However, in addition to this there are also the actual withdrawal fees to take into consideration, which are usually anywhere between £2 - £4 pounds per transaction.
In summary, consumers are advised to think long and hard before they consider using their cards to withdraw cash from a hole in the wall. It makes very little financial sense to do so, and this type of credit management is also considered to be one of the major driving forces behind the accumulation of personal debt in the UK.
