Leading the way in this new innovative way of shopping is Barclays, Barclaycard who have over 5 million contactless enabled credit cards in the U.K. at the present time. It all started in 2007 with Barclaycard introducing the One Pluse, making life easier for many of its customers.

Caffe Nero, one of the largest coffee retailers trailed the contactless concept in December 2008 in central London and completed the roll out across all their stores by October 2009. Managing Director of Caffe Nero, Jonathan Hart, says “We have had very positive feedback from our customers since our decision to trial contactless in December 2008. The rollout across our entire network will give our customers a choice of ways to pay which we hope will enhance their experience with us.”

Another company to roll out this concept is Pret a Manger, who have also successfully roll out the product throughout its 199 shops. Head of I.T. at Pret a Manger , Simon Kerry, said “As a high street food chain, our busiest times are during the morning and lunch time rush hour. These are the best times to pay with contactless as it cuts down on the amount of time that our customers will spend queuing in store. We are pleased our customers have embraced the technology and hope to see an increase of payment via contactless in the next year.”

These are only two of the big names who have rollout this concept, taking contactless payment product with Barclaycard to 20,000 outlets.

Amer Sajed, Chief Executive of Barclaycard UK, Business and International at Barclaycard, comments: “Five million contactless payment cards issued is a significant milestone on the journey of how people will pay for goods and services in the future. Together with Barclays we continue to rollout contactless technology across our card portfolio as we believe it is the future of payments. Consumer feedback highlights the increasing demand for contactless payment and we expect to see more retailers follow Caffe Nero and Pret A Manger and sign up to contactless in the near future.”

Simple advice has been issued in order for credit card holders to make necessary procedures in order to protect themselves from fraud.

Logging out straight after making the transaction then saving the confirmation e-mails are very important in order to record what has been purchased. PC’s should have up to date protection such as anti virus software and the latest operating system.

Only sites with a good reputation should be used and these sites can be identified by looking for the padlock symbol.

Head of fraud control for The U.K. Cards Association, Kate Worobec, said “More of us than ever before will be doing our Christmas shopping online this year, and there is absolutely no reason why we shouldn’t be doing so in complete confidence.”

Finally, credit card holders should never reveal any details to any cold calls they receive.

There are dozens of credit card offers out there that will reward you for every pound you spend either in straight cash back to your account or in the form of reward points. Once you have accumulated enough points you can then use these against particular card features. An example of some features on offer at the moment would be to use points gained against, flights, upgrades, hotel vouchers, days out amongst many others.

These type of credit cards are only beneficial to the customer if they pay their balance off at the end of each month. If they do not make the payments then the interest rates can cancel out the value of the rewards should the balance not being paid off. Setting up a direct debit mandate with the credit card provider can be a way of making sure that payment is made at a specified date.

It can take some time to decide what credit card is the best suited due to taking on board exactly what each offer and what is going to benefit most overall. Once you have made the right choice and manage the credit card in the right manner then you will start to reap the rewards. Head of credit cards at moneysupermarket.com, Peter Harrison, says “The accrual and redemption rates can vary a lot and there’s no real transparency in what the value of each reward is. So we’re looking at rewards and aim to get research out next year.”

MasterCard has said that it has now agreed to halve the fees charged for transactions, but that this was only a temporary measure pending a court appeal. Xavier Durieu, secretary general of retailer lobby EuroCommerce, said: “This temporary settlement sends an extremely negative message to everyone in Europe. This decision is appalling and we count on the Commission to win the court appeal.”

Retailers have been outraged by these fees, and according to reports have claimed that domestic and cross border payment card transaction fees in Europe are amounting to around £11 billion a year. EU Competition Commissioner Neelie Kroes said: “These fees are simply a hidden source of revenue for banks. MasterCard could not justify their level.”

MasterCard officials have said that the agreement to cut the fees on a temporary basis meant that the network could not invest in new products for consumers and retailers and could not sustain string competition within the payments industry in Europe. MasterCard Europe’s president, Javier Perez, said: “That is why these rates are only interim, and why we are pursuing our appeal in the European Court of First Instance.”

Neelie Kroes stated: “We will be monitoring implementation closely in coming months.” She added: “I have no intention that today’s announcement will allow Visa to benefit at the expense of MasterCard.”

One of the measures that the government is bringing in is to stop credit card firms from automatically increasing customers’ credit limits. At present credit card providers review the accounts of customers periodically and then increase their limits accordingly, letting them know by post. However, whilst the customer may not have really wanted the credit limit increased once this is done the temptation is there to spend on the card, which puts the cardholder even deeper into debt. The government wants this practice to stop, and for credit limits to be increased only at the request of the cardholder.

Another thing that many credit card providers have been doing over recent years is sending out credit card cheques to customers, which can then be written like normal cheques. Customers can even write themselves a cheque and put it in their bank, with the amount then coming off their credit card. However, many do not realise that they are then charged high credit card fees for using the cheques. This is something else that the government wants to put an end to.

The Consumer Affairs Minister, Gareth Thomas, said: “We are concerned that people may be tempted to borrow irresponsibly if credit card companies increase borrowing limits without this being requested by customers, or send out unsolicited credit card cheques. It’s vital we protect consumers at this time and we are exploring these issues carefully.”

The bank has already taken billions of pounds in taxpayer’s money as part of a bailout package, and the outrage that this letter has caused has resulted in pressure for some senior officials at the banking giant to resign. Officials have called for the financial services secretary, Lord Myners, to step in and handle the situation.

Philip Hammond, Tory shadow chief secretary to the Treasury, said: ‘It beggars belief that a bank so heavily reliant on public funds is promoting itself as a provider of credit for gambling habits. Taxpayers who are on the hook for a bail-out worth billions of pounds will be horrified. This is grossly irresponsible behaviour and Lord Myners needs to put a stop to it at once.’

Vince Cable, deputy leader of the Liberal Democrats, added: ‘The senior management who signed this off need to be fired. It’s quite extraordinary that a publicly owned company is effectively encouraging borrowers to gamble on their credit cards. It is exactly the type of stupid, irresponsible behaviour that has to be stopped. What makes this even more breathtaking is High Street banks such as Lloyds TSB are refusing to lend money to well-run businesses and borrowers with good credit histories.’

Equifax External Affairs Director, Neil Munroe said “A natural instinct when getting to the point of facing too much debt, especially on credit cards after the Christmas spending spree, is to cut them up”.  He adds “But whilst it’s important to stop using credit when you’re already struggling to manage repayments, we do advise that consumers don’t cut up all their cards.”

He continued “Obviously it’s important to try to get financial matters straight first. But once they have achieved this they may want to use credit in a responsible way to support their finances in the future. If they have had a record of debts and defaults then they will find that new applications may not be accepted, especially as lenders are now operating much tighter criteria when assessing new customer applications.”

“Indeed, in a recent survey* conducted amongst customers of our Credit Reports and Ratings, nearly a third of respondents said they had been refused credit in the last 6 -9 months. 26% thought the reason they were refused was because they had a poor credit rating with 10% saying they thought they didn’t fit the lending criteria. So our advice is to stop using credit cards and do everything possible to pay off outstanding balances. But don’t cut them all up.”

Getting credit from lenders is becoming ever more difficult in the current climate so the message from Equifax is stand up and tackle your financial woes and do not give up.

Mr Munroe warns though “Credit cards are a costly way to pay for essentials if the bill isn’t paid off in full at the end of each month, but we do acknowledge that having access to credit could be useful in the future and that’s why we are advising that consumers don’t cut up all their cards.”

“It’s also crucial not to forget any cards on which there are outstanding balances – any overdue payments will be shown on an individual’s credit file and will be taken into account by lenders when new applications are made. It’s worth consumers getting a copy of their latest credit report to make sure no cards are forgotten. To make this as easy as possible, we have launched a new service which gives them access to their Equifax Credit Report for 30 days for free.”

With these types of cards customers can earn cash back on the amount of money that they spend.  The cash that can be earned back is generally low compared to what is spent but continual regular use of these credit cards can soon see the cash adding up giving the feeling of getting something back in return.

It is a good idea, however, to make sure that you repay what you have spent on these credit cards at the end of each month so that by the time the introductory period is over you are clear to move onto another offer.  By doing this you are making sure that you are not going over to the high interest rates that are charged after the introductory period and making sure that you do indeed benefit from any cash back you have gained.

An industry insider has advised that cash back credit cards have always been popular with customers.  They are offers that the public have accepted more in the current climate but added that due to tighter conditions and the lenders not competing against each other as much there is not as much choice out there as there has previously been on offer to customers.

It is not only the credit card companies that the FSB is asking to help stop the recent closure of small business, which has been seen becoming a even more common occurance these days, but it is also asking the Government, banks, local councils and the consumers to all pitch in and help with the fight for regulation along with having more access to money and keeping the cashflow running smoothly.

John Wright the Chairman of the FSB said “With base rates at 2 per cent and falling, the Chancellor and the Governor of the Bank of England must look into capping interest rates charged on credit cards. A cap on interest rates will at a stroke not only reduce business costs but give consumers a real boost and cut the cost of borrowing. 2009 must be a year of action for small businesses. The small business sector is the sector to see the UK out of the recession. Small businesses are innovative, enterprising and flexible. But an increase in late payments, a decline in trade and poor access to finance will leave thousands facing closure in 2009. With support from the Government, the banks and others, we can all reach a destination in 2009 that takes us out of the dark tunnel of recession and onto the bright road of recovery.”

Recent additions :

• Credit Card Firms Will Have To Do More To Assist Borrowers
• Consumers Should Fight Credit Card Increases
• Affected By The Economic Turndown

The high cost of borrowing on credit cards has even captured the attention of the Prime Minister, Gordon Brown, who has intervened and stated that credit card firms have to stop fleecing consumers and start treating them more fairly, particularly in the current financial climate. The base interest rate has been slashed to just 2 percent over the past few months, but officials state that interest rates on credit cards has been rising over that period.

Part of the meeting with Lord Mandelson focussed on the use of risk based interest rates, which would be set according to the likelihood of the borrower defaulting on repayments on the debt. Credit card companies have also agreed that they will wait at least thirty days before starting any debt collection proceedings providing the borrower is working with a debt advice official in order to try and find a solution towards making repayments on the debt.

Consumer Affairs Minister Gareth Thomas stated: “The government is deeply concerned that borrowers aren’t getting a fair deal. That’s why we’ve taken swift action to bring the industry in to look at how costs are being applied to people’s existing debts.”

• Consumers Should Fight Credit Card Increases
• Affected By The Economic Turndown
• Credit Cards To Hit £ 7 Billion