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Consultation on debt management launched Govt aid for those struggling with mortgages `too late for some` Pensions `no problem` for IVAs UK reaping what it has sown in terms of personal debt, expert claims Struggling consumers `likely to default on TV subscriptions` Consumers `struggling to cope with mounting debt` Bankruptcy increases by 7% `More Brits applying for personal loans` 70% of Brits `without unsecured loans` Pre-paid cards `more popular as debt rises` IVAs `a real alternative` to bankruptcy Brits `trying to escape credit crunch` by moving abroad West Sussex consumers suffering debt IVA agreements increase Industry body welcomes IVA mailing probe OFT to target bogus IVA companies IVAs can be "helpful" for large debts IVAs - consumers warned about bogus deals Insolvency rates rising IVAs can be "better option" than bankruptcy

Pre-paid cards `more popular as debt rises`

18/09/2008

The popularity of pre-paid cards is increasing as consumer debt rises, it has been suggested.

According to Newcastle Building Society, by this time next year, the total number of pre-paid cards issued in the UK will reach over 10.8 million.

Such cards do not allow credit options and, once all the money on them is spent, they must be topped up.

Meanwhile, the value spent on pre-paid cards is likely to exceed £697 million, the financial services provider stated.

The building society also predicted a ten per cent growth in the number of such cards issued to people with Individual Voluntary Arrangements (IVAs) by 2012.

"Without credit options and ties to bank accounts, these cards offer real solutions to a vast number of Britons and are in a very strong position to aid debt management across the country," said Kriya Patel, head of card solutions at Newcastle Building Society.

In other industry news, figures released recently by comparison site IVA.com suggested that the average debt accrued by consumers before they entered into IVAs was £47,000 in August, the Financial Times reported.

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