Expert backs "demise" of store cards
By myfinances.co.uk staff
Consumers should not be "shedding any tears" over the apparent decline of store cards, as most levied "hugely-inflated" interest rates and were widely considered to be a rip-off, an analyst has claimed.
MoneyExpert.com head of research Pierre Williams said that there are positive signs that a shift among high street retailers from store cards to co-branded credit cards could bring more competitive products to the market.
"Credit cards from the likes of John Lewis might not set the traditional card market alight but they certainly trump any old-fashioned store card," he added.
The comments come after research from Datamonitor showed that while the use of store cards has risen in past recessions, demand for the products declined by seven per cent during 2009 and it is expected to drop by a further 4.3 per cent a year to 2014.
However, Mr Williams said that store cards are unlikely to die out completely as they remain a "last resort" for many borrowers, albeit an expensive one.
According to charity Credit Action, average household debt based on the number of families with some form of unsecured borrowing stands at £18,583.
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