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.”

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.’

The BBA advised that over the month £ 218 million had been repaid to credit cards while £ 135 million had been repaid to overdrafts and loans.  The overall spending on credit for the month was down by 8.9% from the previous year.  Along with this the number of purchases on credit cards also fell to £ 98.2 million, down by 5.9% on the previous year.

With the current climate it seems that consumers had turned away from borrowing and more toward saving, which showed with £ 4 billion being paid into banks during the month.

Chief UK Economist at HIS Global, Howard Archer, said “Going forward, consumer borrowing will be limited by ongoing very tight lending conditions, while many people are likely to be increasingly keen to rein in their borrowing.”

“Rising debt levels, historically low household savings rates, plunging house prices and sharply weakened equity markets mean that there is a pressing need for many consumers to improve their finances. Furthermore, we suspect that very serious concerns over jobs and the economic outlook will cause people to try to save more, if they can.”

• Do Not Get Rid Of Your Credit Cards
• Cash Back Credit Card Usage Increases
• Cap The Credit Card Charges

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.

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

Borrowers who find that their credit card providers suddenly increase the interest rate on the card should contact the lender to find out why the rate has been hiked up. If the borrower has a good credit and repayment history there should be no reason why the card company would increase the rate at the current time when the base rate is actually falling, and customers need to ensure that they find out just why the card company has increased the rate, as there is a good chance that the consumer can get the rate reverted back to its original level.

Official from the Financial Ombudsman Service have said that when credit card firms have been unable to justify rate increases they have been forced to reduce the rate back down to its original level. One official from the service said: ‘This is something we are starting to see increasingly more of. What we would want to see is an individual risk assessment of that customer, not some vague statement as to why lending money is more dangerous. Firms are frequently unable to produce this.’

Recent additions :

• Affected By The Economic Turndown
• Credit Cards To Hit £ 7 Billion
• Credit Cards Costing More

One thing that has come out of the research is the way people are spending, by shifting from using credit cards, etc to using now preferring to use cash.  26% of Scots are preferring to purchase using cash which is up on the same time last year.  Londoners are about 20%, 29 in the Midlands, Wales and the rest of the South and 18% of Northerners.

On the up is the amount of 18-24 year olds using plastic to make there purchases, around 30%.  Peter Brooker, Head of Corporate Affairs at Paypoint says “”Young people may be storing up trouble for themselves, by racking up higher and higher debts on their credit cards, which they might not be able to pay back. Even much as worrying, only 10.9 per cent of this age group have had their credit card limit reduced, compared with 14.7 per cent of the 35-44 and 12.5 per cent of the over-55s.”

He continues “The credit crunch, economic downturn and widespread job losses have undoubtedly had an impact on people’s spending habits. Not just how much they spend, but how they spend it.  Overall, people in the Midlands and Wales seem to be taking a responsible approach, with more turning to cash to manage their spending more effectively (69 per cent) and far fewer maxing out on their credit cards – 2 per cent against 24 per cent of Londoners – which could explain why they are still less concerned about their debt level.”

“The most worrying aspect of the research is the attitude of young people who are continuing to rack up debts on their credit cards (at least, those who have them) and could well be storing up problems for themselves later as the economic crisis bites deeper. People who take a more careful approach and stick to cash – so spending only what they have – will emerge from the recession better able to recover financially.”

Recent additions :

• Credit Cards To Hit £ 7 Billion
• Credit Cards Costing More
• How The Mighty Have Fallen

Recent research done by the Abbey has shown that as many as 3 million people will be joining in on the credit card changeover.  According to the Abbey it has become quite a regular occurrence at this time of year with many people of the UK trying to re-arrange their finances for the year ahead. 

The average amount that will be transferred is thought to be around the £ 2000.00 region and it is thought that this is most likely to happen in the first three months of 2009.

Abbey’s Head of Credit Cards advised “The New Year is an ideal time for people to review their finances. By transferring a credit card balance to a card with a 0% introductory offer, consumers can ensure they are managing their finances as effectively as possible.”

Recent additions :

• Credit Cards Costing More
• How The Mighty Have Fallen
• Store Cards Versus Credit Cards