Brits favour credit card over cash for everyday purchases

New research from Sainsbury's Credit Cards has identified a breed of "everyday credit card users" who use their credit cards, as they would a debit card or cash, for everyday inexpensive purchases of £20 or less, and who clear their balances every month. The bank's findings indicate that there are some 7.55 million of these everyday credit card users who spend a total of £3.64 billion on their cards every month.

With as many as 12 million (48%) of all credit card holders not earning any rewards from expenditure on their cards, the bank estimates that there could be as much as £1.76 billion worth of spend by everyday credit card users that is going unrewarded each month.

The average monthly spend figure for a typical "everyday" credit card user is £483, but some 1.41 million "everyday" card users regularly put £750 or more of their overall monthly expenditure on their credit card.

Donald MacLeod, Head of Cards at Sainsbury's said: "Although we'd never advocate people using their credit cards for everyday inexpensive purchases if they are likely to incur interest, we've identified a number of people who clearly like to use their credit card in the same way as they would cash or debit cards and who pay off their balances each month. A card like our own that rewards them for every purchase they make is therefore perfect.

"Unfortunately, recent research reveals that one in two credit card users do not see any financial benefit as their cards don't offer any financial rewards. In truth, there are fewer credit cards offering any form of financial reward linked to the amount of money spent on the card today, compared with four years ago, meaning there's no better time to switch to a card that gives you something back."

About the Sainsbury's credit card rewards:

4 Nectar points awarded for every £1 spent on the card at Sainsbury's - equivalent to 2% cash-back

2 points for every £10 spent elsewhere on the card - equivalent to 0.1% cash back

There is no limit to the amount of points customers can earn

Points can be redeemed against thousands of Nectar offers by simply visiting www.nectar.com

A regular booklet offering discounts worth around £60 p.a. on a range of products available at Sainsbury's stores

Regular exclusive wine offers

In terms of age groups, the "everyday credit card user" who clears their balance each month is likely to be a more mature person (aged over 55), with the 55-64 and 65-plus age group brackets accounting for 48% (3.63 million) of all "everyday credit card users". The age group least likely to use their credit card in this way for inexpensive everyday purchases is the 18 - 24 year age group (representing just 7% of the total). From a regional perspective, people in London are most likely to use their credit card for such everyday purchases (24%); the least likely are those in Scotland and the West Midlands (8%).

As well as offering attractive features and benefits, Sainsbury's credit cardholders can also manage their accounts online with their convenient 24/7 online payment service.

To find out more about the Sainsbury's credit card, visit sainsburys.co.uk