Swift Money

£9bn worth of credit balance will be transferred in the New Year, according to a survey commissioned by Abbey.  In the first three months of 2008, the average transfer will be £2,666 with eight per cent of men and seven percent of women taking on transfer deals.

Men will transfer more money than women, an average of £3,395 compared to £1,820 transferred by women. Geographically, consumers in the South-East and the Midland will transfer the most, £3,021 and £2,900 respectively, larger sums than consumers in the North of England (£2,051), Scotland (£2,154) and Wales and the South West (£2,022).

Roger Lovering of Abbey Credit Cards said:

“Its great to see that many people are already turning their attention to getting their finances in order.  January credit card bills can often catch people by surprise, so we would encourage people to keep a check on their finances over the festive season and plan ahead to ensure they aren’t paying over the odds for their plastic.”

According to new research by MoneyExpert.com 2.6 million Britons will switch credit cards in 2008.  7% of all customers will switch cards, with consumers being urged to take advantage of interest free periods to pay off their debts. Egg and Virgin currently offer the longest interest free periods at 15 months.

Consumers between 15 and 34 are the most likely to switch provider. Geographically 15% of Scottish credit card holders plan to switch compared with 7% in the south-east.

Despite many shopping for the best deal, 6.6 million credit card holders will stay with their credit card provider, paying an average of 16.82%. Sean Gardner of MoneyExpert said:

  “Credit card companies can expect a busy transfer season in January as millions of us wake up to the cost of Christmas before the New Year financial hangover sets in. It is goof to hear people are taking action but worrying that millions will simply add their Christmas debt to their existing debt. Piling on debt is simply adding to the spiral of increasing financial trouble.  People should be taking action to get their debt under control and the first step towards that is to cut borrowing costs.  The next important step is then of course to pay the debt off but transferring a balance is at least a start.”

Some credit card companies are offering 0% rates; however, consumers should be aware of the large balance transfer fees, which at 3% could cost £60 on a £2000 debt.