Would an off button on your credit card stop you spending

Posted by Jasmin Stopford in Personal Finance on 15 November 2016 - Jasmin is a Credit Analyst at checkmyfile

In a bid to stop customers from binge spending, Barclaycard have set up a system in which consumers can block online spending sprees or set themselves daily limits.

Customers are being encouraged to sign up, for what’s described as an ‘off switch’ on their credit, to protect themselves from making rash purchases or making decisions while under the influence of alcohol.

Polly Mackenzie, of the Money and Mental Health Policy Institute explains, ‘Problem spending on credit cards does not necessarily mean spending £20,000 in one go, it might be £30 on a takeaway for the kids. Credit cards are such an easy way to build up credit. People lose track of how much they are in debt and how much it is costing them’.

Barclaycard are offering a range of options so that consumers are able to tailor the controls to suit their lifestyles. Customers are able select for their card to be blocked from online purchases between certain hours, for example between 9pm and 9am. There are also options to cap spending over different amounts of time. For example, if a customer knew they’d spent too much, they could then block transactions for the next 24-hour period.

The ability to shop online means that shoppers aren’t restricted as to when they can make purchases. What’s now known as the ‘vampire economy’ means that people can shop all through the night when they should be sleeping. A survey revealed that one in 20 of us have bought goods from a website after alcohol consumption.

Paul Lockstone, of Barclaycard, concludes, ‘What we have been investigating is the potential for people to be able to turn on and off facilities in relation to their own spending. The challenge is always going to be finding a way to look after the people who need that protection and encouraging them to take advantage of it’.

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