Press Centre

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Christmas means joy - but it can also bring misery

by Jennifer Hill
The Scotsman
Dec 3rd 2005

IT IS Boxing Day and the shops are full of bargains. Prices are slashed on scores of items - including most of the goods you snapped up just days before as Christmas presents.

Spending on credit and debit cards this Christmas is on track to top last year's £27 billion and millions of consumers are in line for the usual January sale frustration, when they see toys, clothes and electrical goods they forked out full price for selling for half price or less.

Paying over the odds can be incredibly irritating. But, with a bit of savvy planning, shoppers can minimise the impact of the inevitable cut-price bugbear.

Consumers could each save as much as £1,000 on a single purchase and up to £3,500 per year simply by signing up for price protection insurance - resulting in a £9bn saving nationwide this Christmas, according to the online price comparison service uSwitch.com.

Not to be confused with costly and often useless payment protection insurance, price protection or "price promise" pays the difference between the price you paid for a qualifying item and a cheaper price available within a certain timeframe.

A few credit cards - including offerings from Citibank and the Royal Bank of Scotland - offer this added bonus, enabling you to do your Christmas shopping at January sale prices.

Citi Classic Plus or Platinum do not charge for the service, but have a maximum claim per item of £500. The Royal Bank of Scotland (RBS) Classic, Gold or Platinum cards, meanwhile, offer price protection for an introductory offer of £1 for the first 90 days.

After that, it costs £18.95 for nine months' cover and £19.95 annually thereafter. The maximum claim per item is £1,000 and per annum £3,500. Its and Citibank's offerings cover good for 60 days after purchase and RBS is also offering 0 per cent interest for nine months - among the longest available.

And, with online spending and fraud on the up, consumers should also look after the pennies when shopping over the internet.

Around two-fifths of shoppers will avoid the high street this year because the shops are too busy, a survey from online bank cahoot revealed.

Two-thirds of those surveyed said they would rather shop online due to the perceived savings that internet shopping brings - despite recent claims from internet traders that electronics companies are forcing up the prices of online goods.

The online Christmas gift market is predicted to be worth around £5bn in the UK this year, accounting for 9 per cent of retail sales in November and December.

But fraud too is on the up, with almost a quarter of the £504.8 million-worth of plastic card fraud losses last year being attributed to online fraud.

Lloyds TSB, meanwhile, is testing a new security system for online banking customers, which gives users a six-digit code, changed every 30 seconds, to be used alongside usernames and passwords.

And, to date, around 100,000 cahoot customers have shopped online with the bank's webcard. Launched in 2001, it works by giving customers a new transaction number every time they make a purchase.

Counting the cost

BRITONS will be counting the cost of Christmas 12 weeks after the big day.

Virgin Credit Card found consumers take an average three months to pay off the collective £13 billion festive bill. Each spends a typical £543 on their credit cards, with most going on gifts (£215) and food and drink (£127).

However, Scots splash out the most on Christmas, spending a whopping £639 - nearly a fifth more than the UK average. Scottish shoppers were the second quickest to pay off their debt though, clearing it by 19 March compared to 17 March among Midlanders.

http://business.scotsman.com/index.cfm?id=2344082005

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