British credit card holders could cut the amount of time they spend paying off their card by 13 years, according to new research.
If consumers paid just £1 more each week than the minimum credit card bill requirement, they could also save themselves £1,247, a study by comparison site uSwitch.com reveals.
The amount of interest paid out doubles for consumers making a minimum two per cent repayment of their card balance, rather than three per cent, with the balance being cleared in 32 years, uSwitch works out.
"In a climate of high interest rates and falling minimum repayments, for some people there is now the possibility that they could finish paying off their mortgage before they pay off their credit cards," said Nick White, head of personal finance at uSwitch.
He added that lower minimum repayments make credit cards have the illusion of affordability for those who would not be able to otherwise afford them.
However, what these in fact do is make money for the bank, Mr White said.
He commented: "Consumers need to realise the true cost of their borrowing and the length of the agreement that they are entering into if they only ever make the minimum repayment."To read more Credit Card News, click here.
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