Store cards lead the interest charge

IS THAT bulge in your pocket a wallet full of store cards, or are you carrying wads of cash? Judging by figures on their use over the past six months, it must be cards.

Research shows the use of cards issued by a range of stores rose by 19 per cent in the 12 months to the end of March. So what is the attraction? Answer: they confer the status of regular customer, and none of them charges an annual fee. Perhaps they are targeted at the shopper rather than the person who pays the bill, because except for John Lewis, which charges 18 per cent APR, and Fortnum & Mason, whose credit customers pay 16.8 per cent, all other stores charge interest rates in excess of that on most credit cards.

Burton Group, whose card is usable at Top Shop, Evans and Dorothy Perkins, weighs in at 29.9 per cent APR. Laura Ashley charges 30.9 per cent, Next 28.9 per cent. Sears, whose card covers Miss Selfridge, Olympus, and Lilley & Skinner, levies 26.9 per cent. Timecard, usable in Comet, B&Q and Woolworths, charges 28.5 per cent APR.

Store-card issuers claim users often gain extra benefits, such as free catalogues and promotional evenings. They also offer interest-free periods of up to 56 days. But most generic credit cards offer a similar interest- free period. Although they levy an average pounds 12 a year, this is offset by the lower interest, ranging from 22.9 per cent for Barclaycard to 23.4 per cent APR for Access.