The Real Cost of LunchBy Moneysupermarket.com, PRNE
Tuesday, June 28, 2011
CHESTER, England, June 29, 2011 -
- UK consumers‘ average
‘small transaction‘ is GBP6.34 for a debit
card and GBP6.63 for a credit card
- Latest figures reveal card spending on small purchases hits
GBP810 million per week
- Increase in contactless cards should see further amount
of ‘small transaction‘
The latest figures from the British Retail Consortium (BRC)
indicate UK consumers are increasingly turning from href="www.moneysupermarket.com/credit-cards/">credit
cards to cash and debit cards, with debit card transactions up
15.8 per cent in the last year. Research from moneysupermarket.com*
reveals insight into the spending habits of people using debit or
credit cards, and how they regularly choose to pay for everyday
’small transactions’ under GBP10 on their cards.
According to the
research, over half of Brits (56 per cent) are using their debit
card to purchase items under GBP10, with an average of 3.2
transactions a week. The research also revealed the average
transaction was GBP6.34meaning UK consumers are funding a
whoppingGBP560 million** worth of small purchases on their debit
cards; which amounts to just over GBP20 per week and over GBP80 per
month for each individual.
Despite the decline in overall credit card usage found by the
BRC, Britons’ spending on ’small transactions’ still remains high,
with almost a quarter of consumers (23 per cent) still funding
small purchases on their credit cards. The average spend for these
transactions is GBP6.63, and an average number of weekly
transactions of 3.4, means the nation’s weekly bill for small
transactions on credit cards is over GBP250 million ***.
Someone spending GBP22.50 per week on their credit card, GBP90
per month, risks paying an extra GBP105.06 in interest over 12
months if they fail to pay off their balance in full, meaning a
cheap lunch can end up much more expensive than they realise.
The rise of contactless cards is likely to fuel the number of
small transactions being paid for on credit. The UK Cards
Association**** has already seen an increase in contactless card
usage from 13.8m transactions in January this year to 15.1m in
March, and we can expect to see these figures increase even further
as more card providers issue contactless cards and retailers
install terminals to accept these type of transactions.
Kevin Mountford, head of banking at
said: “Paying for a low-cost purchase using a debit or
credit card is convenient, and with the onset of contactless
technology, getting even easier. However it is easy to fall into a
trap and be caught out by not keeping a close eye on these smaller
transactions - they soon mount up.
“If you accidentally stray over your authorised overdraft limit
or fail to pay off your credit card in full at the end of the
month, it could end up costing you dearly and that ‘cheap’ lunch
may end up being far more expensive than you anticipated.
“If you can’t afford to pay off your credit card in full each
month don’t use it to pay for everyday spending such as your lunch
or coffee on the way into work.
“For those who already have an outstanding balance on their
credit card, it is important to look how to clear that debt as
quickly as possible. Consider moving the debt onto a credit card
offering zero per cent interest on balance transfers such as the
Barclaycard Platinum with Extended Balance Transfer which offers 20
months interest free could be a good option.”
Notes to Editors:
*Opinium Research conducted research between 21st and
23rd June 2011, amongst 2,013 nationally representative
adults aged 18+
** Average spend (GBP6.34) multiplied by average transaction
number (3.2) = GBP20.29. Those making small transactions on a
debit card - 56 per cent of total adult population (49,121,000) =
27,645,298. 27,645,298 X GBP20.29 = GBP560,923,069.42
*** Average spend (GBP6.63) multiplied by average transaction
number (3.4) = GBP22.54. Those making small transactions on a
credit card - 23 per cent of total adult population (49,121,000) =
11,297,830. 11,297,830 X GBP22.54 = GBP254,653,088.20
**** according toUK Card Association UK Plastic Card
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Tags: Chester, England, June 29, Moneysupermarket.com, United Kingdom