Credit cards used by many to pay bills

A new report has found that one in seven of us are regularly using credit cards to pay our household bills . The study, by finance website moneysupermarket.com, also found that a further 7 per cent are using credit cards to get cash out regardless of the high interest rates charged.

Nearly half of people in the UK are using credit cards to purchase large items, 43 per cent use a card to pay for daily transactions such as shopping, while 38 per cent use plastic to pay for petrol.

With the surge in rewards and cashback credit cards on the market, consumers are increasingly using their cards to obtain reward points from their card providers.

Reward cards such as Sainsburys Nectar credit card offers double points when used in one of the stores, online or for petrol for two years after taking it out. The Barclaycard Freedom rewards scheme, on the other hand, lets cardholders collect redeemable reward points at retailers such as Pizza Express, Shell and Flight Centre .

The move towards greater use of credit cards on an everyday basis is an expensive one, however, as the typical charge applied for each transaction is GBP3, while interest rates on cash advances are often over 20 per cent.

Kevin Mountford, head of banking at moneysupermarket.com, said Used responsibly, credit cards can be an integral part of household budgeting but it's alarming to see so many people using their cards to pay for what should be everyday spending.