Credit card cash withdrawals 'a sign of financial difficulty'
Credit card cash withdrawals 'a sign of financial difficulty'
- Friday, 24 April 2009People who withdraw cash on their credit card may be experiencing financial difficulty - such as debt trouble - according to a price comparison and switching service.
Research by uSwitch reveals that a recent move by credit card provider Egg has been designed to deter consumers from making small cash withdrawals, as this is often a sign of money trouble.
The group asserts that Egg is one of the few providers to have maintained a low interest rate on cash withdrawals over the last two years, which at 22.9 per cent is still competitive. But across the board, fees for taking out cash on a credit card have risen.
While previously cash withdrawals would have cost Egg customers £3 each, this will now increase to £5, which may deter consumers from using the service.
Louise Bond, personal finance manager at uSwich, said: "The rationale for Egg's change is reasonable. However, we strongly advise customers not to use this facility on any credit card unless they are really desperate for the cash."
Unbiased.co.uk revealed last month that it takes the UK an estimated 83 days to work off the interest owed on its combined debts.
Its chief executive David Elms stressed there are many advantages to paying off debts as quickly as possible and suggested people may wish to speak to a financial adviser about their
debt management options.

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