Card companies ‘targeting debtors’
Credit card companies are increasingly trying to attract customers with existing debts, it was claimed today.
Research by MoneyExpert.com found the number of zero per cent balance transfer deals on the market has increased by 13 per cent in the past year and that the average interest free period on offer has grown to ten months.
It also discovered the average length of an introductory offer providing zero per cent on purchases is just 4.57 months and the personal finance website's chief executive Sean Gardner concluded that it is clear where the lender' priorities lie.
"Card firms are concentrating on the balance transfer market as a way of building new business with more generous offers for those who want to get their debts under control," he explained.
Mr Gardner added that although zero per cent balance transfer deals can provide borrowers with "vital breathing space", they will not help to reduce debt unless they are accompanied by a change of spending habits.
Price comparison website uSwitch.com recently warned that changes to lending policies among credit card providers could mean that many cardholders will find it difficult to get approval to take out a new card with a zero per cent balance transfer deal.
It advised borrowers who find themselves in that situation that a debt consolidation loan is one way of easing their credit commitments.
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