Credit card deal cuts repayment time, says provider

Thu, 08 Jun 2006

Barclaycard Flexi-Rate customers are paying off their credit card bills more quickly, according to research.

The repayment time is lower and also the amount of interest paid on the credit card is less, states the study, conducted by Barclaycard.

Since its launch in October 2005, Barclaycard believes that half as many customers are paying the minimum repayment on their credit cards, while the proportion of customers paying over the minimum has risen by ten per cent.

James Le Brocq, head of Barclaycard UK credit cards, commented: "Flexi-Rate is doing exactly what it was designed to do – that is, encouraging people to pay back borrowing sensibly.

"Increasing the amount you pay back each month can dramatically reduce both interest costs and the time it takes to repay."

Barclaycard will also be adding a new message to statements, warning customers who are paying the minimum on their credit cards that this will lead to more interest payments in the long-term.

Recent research conducted by credit card provider Morgan Stanley shows that more UK credit card holders are using their credit cards to make everyday purchases, such as food and bills.

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