Struggling Borrowers Should Get Debt Advice Before Cutting Back

Financial solutions company Think Money have advised people who are struggling to repay debt tocarefully consider how and where they cut back on their spending, following the release of a study showing that millions of people have cut back on insurance in the past 12 months in order to save money.

The report from Sainsbury’s Finance estimated that almost one million (946,000) people have either cancelled or reduced their home contents insurance cover in the past 12 months as a direct result of their financial situation, while over half a million (532,000) have cancelled their life insurance policy for the same reason.

Meanwhile, 432,000 car owners were estimated to have reduced the amount of car insurance they had, while 349,000 people reduced their home buildings insurance and 104,000 reduced their pet insurance.

A debt expert for Think Money said that while cutting back in certain areas could be a good way of saving money in the recession, people should be careful about where they decide to cut costs.

“For example, increasing numbers of people are buying food from ‘budget’ stores, rather than the ‘big’ supermarkets they are used to, which can save a lot of money. Likewise, people are buying more second-hand cars, eating out less, etc. – and these are all relatively sensible areas in which to cut back.

“However, when it comes to cutting back on insurance, people are taking a risk. Insurance is there for a reason: it protects against unexpected large bills that can occur at any time. Without it – say, the person’s house is flooded – people can find themselves in a far worse financial situation than if they had simply kept their insurance policy, and that brings a real risk of falling into debt.”

The Think Money spokesperson added that even cutting back in ‘sensible’ areas is not the key to financial security, unless people are strict with their finances.

“Setting a strict budget is a very important part of financial management, and that budget must be realistic in terms of how much needs to be put aside for essential costs and how much can be kept back for non-essential spending.

“People should also ensure that if they are freeing up money by cutting back, that money should be put towards their debts rather than non-essential purchases.

The spokesperson said that anyone who finds that cutting back on costs alone is not enough should seek professional debt advice.

“Ideally, anyone who finds themselves struggling to repay debt should speak to a professional debt adviser at the earliest opportunity. A debt adviser can help the borrower to establish the best course of action for reducing their debts – and the sooner this happens, the less difficulty the borrower is likely to face.”

Via EPR Network
More Financial press releases

Caution Advised Over Student Debt

Responding to a new survey suggesting that students were spending more money and receiving more financial support than ever before in the last academic year, financial solutions company Think Money has advised students to remain aware of the longer-term costs of using credit during their education.

The company added that while student finance is a useful and necessary means of funding education, students should be aware of the potential implications of getting into large amounts of debt, and should ideally avoid using credit that may have strict repayment terms, such as credit cards and personal loans.

The study by the Department for Innovation, Universities and Skills, which looked at the 2007/2008 academic year, found that higher tuition fees have increased first-year student spending by 12% in just three years.

This means that students are now completing their first year of university education with an average of £3,500 debt. If this continued each year on a three-year course, the average student could end up with over £10,000 of debt.

Despite this, the study found that fewer students were taking part-time jobs to help fund their education, falling from 58% in the previous survey (2004/2005) to 49%.

Although spending had risen by 12%, students’ income had risen by 15%, including loans for tuition fees (which are paid directly to universities).

Melanie Taylor, Head of Corporate Relations for Think Money, said that students should be careful to distinguish between normal student debt and additional credit.

“Student Loans from the Government are designed to be paid back in relatively small instalments after the student finishes their education, and only once they are earning enough to meet the minimum repayment threshold – currently £15,000 per annum. In that respect, student loan repayments are rarely a worry for graduates.

“Many students are concerned about the levels of debt they may be faced with on leaving university, but in reality this should not impact much on their lives at all, and people should not feel ‘priced out’ of further education, regardless of their background.

“However, it can become a more serious issue if the student uses other forms of credit, such as credit cards. Since these usually require repayment shortly after they are first taken out, these forms of credit can place a burden on students’ finances that they may not be able to manage.”

Mrs Taylor added that anyone who does find themselves with debts that they cannot manage should contact an expert debt adviser at the first sign of trouble.

“For anyone who gets into debt and realises they are unable to make their repayments, the most important thing is that they seek advice as soon as possible.

“There are a range of debt solutions available that can help people in various situations. A professional debt adviser can discuss the borrower’s situation in confidence and help them to decide which is best for their individual needs.

“Most debt solutions require a constant income, which can put some students at a disadvantage – but a debt adviser can still offer free, valuable advice that could help them to get their finances back in order.”

Via EPR Network
More Financial press releases

Barclaycard To Pilot New Visa Corporate Card

Barclaycard has announced its involvement in piloting a new a payment card, in association with Deloitte and Visa Europe.

As well as being a standard Visa Corporate card, this innovative new card enables Deloitte employees to remotely access their company IT system via a virtual private network (VPN). The card has a keypad and LCD screen embedded into it, to allow users to enter their PIN and generate a one-time use passcode. This passcode is then authenticated by Deloitte’s VPN. In addition, the card ensures that cardholders have the convenience of only having to carry their Corporate Barclaycard without the need to carry a separate security token or device. The technology that the card uses was developed in conjunction with EMUE Technologies.

The Barclaycard pilot is the first corporate card pilot of the Visa Credit Card with one-time code functionality in Europe and is expected to reduce user costs substantially compared to using a separate token device for remote network access. In addition, Barclaycard’s proven capability will provide improved information on card usage with up to date transaction statements available online.

In addition to supporting remote network access, The Visa Corporate Barclaycard features other applications. It is compatible with Verified by Visa which could prevent card not present (CNP) fraud and identity theft associated with online banking, telephone authentication and other remote channels.

Barclaycard’s leading role in the piloting of this new card was recognised when it won the ‘Best use of innovation within Visa systems or services’ award at the recent Visa Europe Insights event.

The award highlighted Barclaycard’s commitment to using technology in an innovative way to bring additional benefits for its customers.

Neil Radley, Managing Director of Barclaycard Commercial, commented: “This product is an ideal solution for our corporate customers as it effectively combines two items in one; as well as being a standard Visa corporate card it incorporates a token which enables safe and secure virtual private network (VPN) access. We are delighted to be developing this innovative card with Visa Europe.”

Simon Owen, Senior Partner who leads the Information and Technology Risk practice at Deloitte, said: “The EMUE technology enabled Visa Corporate Barclaycard offers real benefits for card issuers based on our own experiences of providing staff with one-time code functionality for remote access. We estimate that we could save up to 65% per user over having a separate traditional token device.”

Sandra Alzetta, Senior Vice President for Innovation at Visa Europe, commented: “Innovation is a key factor in Visa Europe’s continued success and growth. We are continually working to make Visa the most secure and convenient choice for both corporate and consumer cards. By embedding a battery, PIN pad and LED screen in a payment card, we believe we are offering the most innovative card product in the marketplace.”

About Barclaycard 
Barclaycard, part of Barclays Global and Retail Commercial Banking division, is a leading global payment business which helps consumers, retailers and businesses to make and accept payments flexibly, and to access short-term credit when needed.

The company is one of the pioneers of new forms of payments and is at the forefront of developing viable contactless and mobile payment schemes for today and cutting edge forms of payment for the future. It also issues credit and charge cards to corporate customers and the UK Government. Barclaycard partners with a wide range of organisations across the globe to offer their customers or members payment options and credit.

In addition to the UK, Barclaycard operates in the United States, Europe, Africa and the Middle and Far East.

Via EPR Network
More Financial press releases

Barclaycard Reduces Balance Transfer Fee

Barclaycard has announced that it is reducing the balance transfer fee on its 0% for 12 months Barclaycard Platinum balance transfer deal with immediate effect.

The change means that the current balance transfer fee on the Barclaycard Platinum card has been reduced to 2.5% of the amount transferred from the previous level of 3%. This offer is available for any transfers made within 60 days of opening an account, on amounts up to £5,000. The reduction means customers will be able to save £25 on a £5,000 balance transfer onto the Barclaycard Platinum.

The reduction in the balance transfer fee following the Barclaycard announced in February that it was reducing the annual percentage rate (APR) on its Barclaycard Platinum credit card from 14.9% down to 12.4%. This means that at the end of the promotional balance transfer period, the rate on the card will revert to ne lower rate of 12.4%.

Commenting on the reduction, Amer Sajed, Managing Director of Barclaycard UK said, “This reduction will mean customers looking to move their balance now have to pay less to get a market leading deal”.

Along with services like identity protection, fraud monitoring, purchase delivery protection and contactless payment technology, the new lower rate will help to further consolidate Barclaycard Platinum’s position as the market leading credit card in the UK.

Notes to Editors
The reduced balance transfer fee is available through the Barclaycard website. Barclaycard reserves the right to withdraw this offer at any time. Terms and Conditions apply. Barclaycard is subject to application and status. This offer is only available to new customers.

About Barclaycard:
Barclaycard, part of Barclays Global and Retail Commercial Banking division, is a leading global payment business which helps consumers, retailers and businesses to make and accept payments flexibly, and to access short-term credit when needed.

The company is one of the pioneers of new forms of payments and is at the forefront of developing viable contactless and mobile payment schemes for today and cutting edge forms of payment for the future. It also issues credit and charge cards to corporate customers and the UK Government. Barclaycard partners with a wide range of organisations across the globe to offer their customers or members payment options and credit.

Via EPR Network
More Financial press releases