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Store cards: insolvency trade body calls for ban

Financially unqualified staff in shops should not be allowed to sell store credit cards, insolvency trade body R3 has stated.

R3 - the Association of Business Recovery Professionals - has warned that selling `point-of-sale` store cards `contributes to the mountain of personal debt in the UK and entices vulnerable customers into debt`.

66% of Insolvency Practitioners (IPs) surveyed said they had seen cases of people signing up for store credit cards without understanding `what they had let themselves in for`. And a full 72% believed that getting a credit card is too easy.

R3 President Peter Sargent said: "It is frankly irresponsible to sell credit over the shop counter as though it is no more important than buying a sandwich. Without proper training, shop assistants are inappropriately qualified to understand the consequences of what they are selling and often commission driven. While these cards are presented as innocuous, they can lure vulnerable people into debt. They should only be sold by people who have been sufficiently trained to sell financial products."

The R3 press release refers to case studies involving people with over 30 credit cards - and people with unsecured debts of £300,000.

"The expression `decade of easy credit` is one we`ve all heard many times," said a spokesperson for the IVA Advisory Centre, "but taking on debt of any kind is a serious matter and should never be done without careful consideration.

"Anyone who finds they`ve taken on too much debt and are losing control of their finances should talk to a debt professional. They may find that a debt solution such as a debt management plan or IVA could help them get back in control and clear their debts."

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The IVA Advisory Centre are a licensed Insolvency Practice, offering free debt advice as well as IVAs and a comprehensive range of other debt solutions. If you are in debt and would like to explore your options, contact one of our advisers today.