Consumers are hunting for credit card deals

Consumers are on the look out for the best credit card deals they can find, as their debt begins to mount, one expert has said.

According to a leading finance website, money conscious Brits are now scouring the market for credit cards which will help them budget, focussing on things such as zero per cent interest balance transfers.

Bank of England figures for March show that Brits are paying off credit card debts for the first time in 16 years, as consumers are looking to reduce their repayments during the downturn.

A US-based TNS study recently found that cash back rewards are gaining popularity in the current economic climate.

The TNS Consumer Credit Card Program Study discovered that there has been a marked increase in consumers choosing cash back rewards for credit and debit card usage. In the past consumers had prioritised air mile rewards and rebate programs.

Furthermore, reward cards are influential in many of customers' essential decisions relating to credit cards, from acquisition to primary card status.

Michelle Slade, a spokesperson from Moneyfacts.co.uk, said: "Consumers are aware that their credit card borrowing is likely to be their most expensive debt in terms of APR and with worries over rising unemployment they want to get their finances in order.

"The message is really starting to get through and many consumers now know how to get a good deal, whether it is a cash back card or balance transfer card."

Meanwhile, research conducted by Abbey, published on March 13th, found that more than two-thirds of Britons (69 per cent) have at least one credit card, with the average credit card debt standing at £3,256.

Those aged over 55 are most likely to own a credit card (77 per cent), compared to 71 per cent of those aged between 35 and 54, and 58 per cent of those aged between 18 and 34.

What is more, despite the high levels of credit card debt in the UK more than half (55 per cent) of card holders haven't moved any of their existing debt to a zero per cent balance transfer deal and just 11 per cent of card holders have moved all of their existing debt to a zero per cent deal.

Ms Slade advised consumers to find a credit card that best suits their specific needs, urging those with debts to seek out a zero per cent balance transfer card.

She concluded: "Cashback cards are highly popular as if you pay the balance off in full you are earning money out of the card company rather than the other way round. This is why they are few and far between nowadays."