Missing a credit card payment could cost your dearly

Missing, or being late paying one credit card payment could cost hundreds of pounds in additional interest, following the loss of promotional deals and may potentially leave a blip on the cardholder's credit profile, according to analysis from moneysupermarket.com.

Consumers who have debt on an existing credit card can move their expensive debts to a 0 per cent balance transfer deal. The advantage of these deals is that customers pay no interest on their borrowings, but they do require discipline. By missing or being late on just one payment can mean forfeiting your interest free benefit, and land you with a hefty bill, so setting up a direct debit to avoid missing the minimum repayment is crucial.

For example, forgetting to make a payment may mean shelling out a £12 late payment charge, and would potentially lead to the loss of the promotional rates on the card. The rate would revert to the card's typical APR; with many in excess of 18 per cent, a customer transferring a balance of £2,000 would accrue additional interest of £339.27 over the year as a result of their error.

Peter Harrison, credit card expert at moneysupermarket.com, said: "An interest free balance transfer can be a great option for consumers looking for some financial flexibility, but many customers are unaware of the severe impact a single missed payment can result in. For those who do go down the balance transfer route, it's crucial that they make regular payments; otherwise they will not only receive a late payment charge, but could also lose their zero per cent deal. Setting up a direct debit for the minimum repayment as soon as you take out the product is crucial, especially if you're the type of person who may inadvertently miss a payment or pay it late. However, when you receive your first statement, check with your provider to make sure the direct debit has been set up correctly, don't assume it will be set up in time.  It is not advisable to repay just the minimum repayment each month, so look to make additional payments on top of the direct debit to bring the balance down and repay the debt before the 0 per cent deal comes to an end.

"It's also worth noting that missing payments could have a negative effect on a customer's credit rating, making it harder to get accepted for products in the future. For anyone looking to make a credit application after a missed payment, it's worth waiting a couple of months to show that you have got your credit file back on track and that it was just a blip. Lenders are scrutinizing credit applications in greater detail than they did prior to the credit crunch, so even the most minor mistake can cause problems.

"If you do miss, or are late making a payment on your card, you should speak to your card provider immediately and ask for your promotional rates to be reinstated. There is no guarantee this will be done however, it is at the discretion of the provider, and they will treat each case on its own merit."