Have you recently received a batch of cheques from your credit card company suggesting that you might like to use them to treat yourself? No? Well that’s surprising as over 10 million are sent out to cardholders every year.

Beware. If you use the cheques the charges can be high. Purchases sometimes attract a higher rate of interest than standard card purchases and there’s no interest-free period. You may also be charged a handling fee of up to 2%. All these charges swell the credit card company’s coffers by around £57 million every year – so they’re particularly keen on them!

But the Office of Fair Trading and the consumer group “Which” are much less impressed. They are urging consumers to tear the cheques up. They also want legislation to ensure that the credit companies properly inform their clients about the true costs of using the cheques.

Even last year, as part of a wide ranging enquiry into the credit card market, the influential Treasury Select Committee concluded that card companies should stop mailing unsolicited cheques. Their concerns were the cost of the cheques and the way these cheques were encouraging additional debt.

“Which” certainly agrees with the Committee. Their spokesman said “We want unsolicited credit card cheques to be banned, especially as we have found that companies use them to encourage indebtedness”.

We agree.

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