Direct Debit Can Put A Third More On Your Premium

Direct debits have blossomed in popularity in recent years, especially among those who have difficulty staying on top of their finances.

The convenience of the out of sight, out of mind payments are such that 35 million people in the UK now have at least one direct debit set up.

They are popular with companies as well, with the savings to be made by the added savings to an average household by paying through direct debit adding up to nearly £200.

But sometimes it seems we have to pay for convenience. A Research firm has uncovered that motor insurance companies charge drivers up to 37 per cent extra a month for the luxury of direct debit.

"You're almost certainly better off putting motor insurance on your credit card and paying the balance off gradually," says an associate director of the firm.

"Most motor insurance companies make their money out of investing your premium over a year. If you're paying gradually, they can't do that," he added.

Only seven per cent of motor insurance companies said that they did not charge a premium for paying with direct debit.

Be Wiser is a quality provider of Motor Insurance.