Online Christmas spending hits record high

Britain faces another Christmas on credit as UK shoppers prepare to spend an incredible £2.1 billion on their credit cards in a last minute Christmas shopping spree.

Analysis from Sainsbury's Bank has reported that people are planning to spend some £11.85 billion during the last week before Christmas - an incredible £2.7 billion more than last year's research reported.

However, Fair Investment Company, the financial news portal and comparison website, is urging consumers to make sure they are getting the best deals on their credit cards in order to make the most of their spending over the festive period.

Last month's Retail Experian FootFall Index revealed that online sales were beating purchases on the high street by a sizeable margin with November reporting the highest month-on-month rise in shopper numbers so far this year while Hitwise, reported a massive 22.4 per cent rise in online visits to all shopping and classifieds sites during November.

The boost in online sales has also meant that far more people are spending on their credit and debit cards however, high street retailers are hoping to claw back some of the profits swallowed by online spending by making dramatic price cuts in the run up to Christmas.

James Caldwell, Director of Fair Investment Company comments: "Despite the turbulent financial markets, falling house prices and rising living costs, the boom in online activity goes to show that British shoppers are still determined to celebrate this Christmas.

"The recent research suggests that the decline in numbers of consumers choosing to shop on the high street seems to be down to the convenience of shopping online rather than a drop in spending. However, with 18 per cent of the anticipated £11.85 billion of the last minute spending going onto consumers' credit cards, it is not too late to try and make the most of some of the deals on offer by card companies."

Sainsbury's research reveals that around 1.4 million people intend to spend more than £1,000 in the week before Christmas and a further 4.4 million people intend to spend between £501 and £1,000. However, only 61 per cent expect to clear this off their credit cards by the end of January, 15 per cent expects to pay it off within two or three months and one per cent anticipate it could take up to next Christmas to clear.

Mr Caldwell continues: "For those who will be putting their Christmas purchases on their plastic this year, it makes sense to get a card offering 0 per cent on purchases, for those who don't intend to pay off the full balance. For those who are about it come off an existing credit card deal, it is worth shopping about to see who is offering the best rates, but remember to check the credit card small print of the new card provider before you do. Avoiding unnecessary interest charges will hopefully go some way to ensure that consumers don't end up with a financial hangover in the New Year."

Make sure you are getting the best credit card deal using our FREE comparison service: fairinvestment.co.uk/deals/compare_credit_cards.aspx