Credit card debt payments 'may prove preferable to saving'

Rather than saving money, a number of people might be inclined to make credit card debt repayments at the present time.

That is according to Defaqto's banking specialist David Black, who feels that the current financial environment may be having an impact on the attitude of consumers.

With the base rate set to stand at 0.5 per cent for another month, Mr Black has highlighted the negative implications that this low rate could have for savers in the UK.

He stated: "The paucity of most savings rates on offer means that many with spare cash will be looking to reduce their more expensive debt, such as outstanding debt on credit cards [or] unsecured loans."

Meanwhile, the large rate of inflation is another factor that savers are having to contend with, Mr Black believes.

The last time the base interest rate stood at more than 0.5 per cent was in February of last year, when a rate of one per cent applied.

Posted by Gemma Walker.