3m card applications rejected
Nearly 3m credit card applicants have been turned down in the past six months as lenders tighten up their borrowing procedures.
A wave of bad debts that have hit banks over the past two years have forced banks to tighten up their lending criteria and concentrate on customers with the best credit ratings.
During the latest set of financial figures from the banks, HSBC, Barclays, Royal Bank of Scotland and Lloyds TSB wrote off a collective £11.6bn in customer bad debts last year.
Barclaycard, the UK's largest card company, said it was becoming more 'selective about customer recruitment' as a result of the bad debts.
According to research from comparison service MoneyExpert.com, 2.8m people have been rejected in the past six months, equating to 15,555 rejections a day.
The high number of rejections is bad news for customers with large balances on their cards that regularly switch provider to take advantage of balance transfer deals.
MoneyExpert chief executive Sean Gardner said: 'Credit card companies have been badly burnt with bad debts and are putting the shutters up in response by turning down more and more applications.
'Anyone with debt problems who is hoping for an easy way out by taking out another credit card is liable to find that they'll be turned down.'
Those aged between 25 and 34 are most likely to have their card application turned down, with people above 55 least likely to be turned down.
Gardner added: 'It is entirely sensible for credit card companies to reject applications from people with debt problems or who look as if they have already borrowed enough. Rising interest rates mean it is harder to service debts and people should not be encouraged to get deeper in debt.'
Checking your credit history is the first step to dealing with debt.
Source: This is Money.co.uk
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