A new study, conducted by the UK’s leading credit authority has discovered that consumers who frequently choose to make bare minimum repayments on their credit cards, are more likely to run into debt problems as a result.

According to the study, almost 60% of credit card owners are in the habit of making minimal repayments to their card balance each month, with the majority claiming that they choose this option as a matter of “convenience”. However, very few people are actually aware of the debt implications associated to making small repayments on cards.

In almost all cases, making the smallest possible repayment on your card will actually increase your overall debt, and crucially, will keep you in debt for longer. Typically, the smallest contribution a person can make to their card balance each month is around 2-3% (or £5). However, the rate of interest tied to the majority of card balances is at least 10 times that amount. What this means to the consumer, is that by making the smallest possible contribution, you will only be repaying a small proportion of the accumulated interest, and not touching the actual balance.

This fundamental lack of understanding by card users has caused much concern amongst officials, mainly due to the fact that people are running the risk of amassing serious debt, without even realising it. It has been suggested that the average card balance currently stands at around £3000, however if a person opted to make the smallest possible repayment (and discontinued to use their card) it would take almost 25 years to clear the debt. The reality however, is that people continue to spend on their cards, and continue to make minimal contributions. This in turn causes their overall debt to increase dramatically, as they accumulate interest on top of the existing interest and so on.

The minimum repayment option should never be viewed as a convenience, and you should always try to clear as much of your balance as possible, whenever the opportunity should arise. Alternatively, if you haven’t already done so, it may be worth switching your balance to an interest free card. Many cards offer 0% interest fixed term facilities, however always read the small print as some cards will not allow you to re-switch or may charge a fee as a result.