Consumers switch less often

Mon, 23 Jul 2007

Consumers are no longer switching between financial service providers as rising interest rates have created a climate of caution, according to MoneyExpert.

The number of people switching their financial products and services has decreased by five million since January.

Credit card holders and mobile phone owners have switched providers less often in the past six months than any other financial service user, as MoneyExpert blames the changes on providers who are getting tougher and withdrawing better deals.

Chief executive of MoneyExpert Sean Gardner claimed consumers are less inclined to switch when rising interest rates have created a tight financial situation.

"The reality is that consumers are battening down the hatches in preparation for a rough ride as the mortgage becomes more expensive and disposable income reduces. It seems we're all taking stock of our finances - and perhaps switching is an unwelcome distraction in the current climate," he remarked.

MoneyExpert warns consumers that regularly reviewing the financial market is best practice, although switching services and products may not always make financial sense.

The Bank of England raised interest rates to 5.75 per cent in July.


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