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The 'gift' from your credit card that pushes you into debt
The 'gift' from your credit card that pushes you into debt
This is a duplicate of the Blog Entry made on: 3rd June 2016 13:58
This is a duplicate of the Blog Entry made on: 3rd June 2016 13:58
Unrequested credit limit increases harming borrowers, warns charity
Many of us will recognise the letter. It arrives, unannounced from your credit card provider with a piece of supposedly good news - your credit limit has been increased. But these unrequested raises to credit card limits are making debt problems worse for 50,000 borrowers and must be stopped, a leading debt charity has warned. Research by StepChange found that 54 per cent of its clients had their limit increased without asking for the change to be made - and 49 per cent of them said it made their debt problems worse.
The charity also found that 11 per cent of its clients in financial difficulty had their credit limits extended when asking their creditors for help. StepChange says: 'Offering people more credit when they are struggling can push them further into debt and that banks not only need to ensure they are carrying out thorough affordability checks, but also identify people who are in difficulty early and provide effective financial assistance, not more credit.' It explained that when someone’s credit card limit is increased, it can put them under financial pressure if they take on this credit and later find they cannot afford to sustain it, particularly if their income drops.....Read more here
Read more: http://www.thisismoney.co.uk/money/c...#ixzz4AWL8GULS
Follow us: @MailOnline on Twitter | DailyMail on Facebook
Many of us will recognise the letter. It arrives, unannounced from your credit card provider with a piece of supposedly good news - your credit limit has been increased. But these unrequested raises to credit card limits are making debt problems worse for 50,000 borrowers and must be stopped, a leading debt charity has warned. Research by StepChange found that 54 per cent of its clients had their limit increased without asking for the change to be made - and 49 per cent of them said it made their debt problems worse.
The charity also found that 11 per cent of its clients in financial difficulty had their credit limits extended when asking their creditors for help. StepChange says: 'Offering people more credit when they are struggling can push them further into debt and that banks not only need to ensure they are carrying out thorough affordability checks, but also identify people who are in difficulty early and provide effective financial assistance, not more credit.' It explained that when someone’s credit card limit is increased, it can put them under financial pressure if they take on this credit and later find they cannot afford to sustain it, particularly if their income drops.....Read more here
Read more: http://www.thisismoney.co.uk/money/c...#ixzz4AWL8GULS
Follow us: @MailOnline on Twitter | DailyMail on Facebook