Martin Lewis issues warning to debit card users as he gives crucial credit card tip

Martin Lewis has delivered a warning to people who use debit cards, advising them to consider opting for a credit card instead .

Speaking on his ITV show, the money expert called debit cards with an overdraft “danger cards”. He explains that the average bank loan carries an APR (annual percentage rate) of less than 8 percent APR, while the average credit card rate hikes up to 19 percent APR.

Most overdraft charges on debit cards are now at 40 percent, leaving consumers with almost double the interest to pay back.

Mr Lewis explains on his show that “the first thing if you’re overdrawn is to check your eligibility for a 0 percent overdraft and to what amount.

“People also ask me, can I shift my overdraft onto a 0 percent card? The answer is yes, but only a few specialist cards, it’s called a money transfer.”

“With a money transfer card you apply for a new card and it pays the money into the bank account for you so you can get rid of your overdraft, you now owe the card.”

“It’s best for large overdrafts, you need a decent credit history.

“With your overdraft, treat it like every other debt. Try to shift your direct debits to just before payday, so the longer you’re overdrawn, the bigger your interest charges. So if you can move it to just before payday, you won’t be in debt for as long and it should reduce the interest.”

His advice comes after Barclaycard adjusted its minimum repayment amounts earlier this year. Mr Lewis said the move could ‘double your debt’.

“Minimum repayments have always been credit card firms’ secret weapon. Letting people repay little looks appealing – hence why Barclaycard says this is about ‘flexibility’,” he said.

“Yet it takes flexibility to kick your own backside, and this will hurt some just as much.”

The Money Saving Expert founder also recently addressed the DWP’s controversial two-child benefit cap policy , as well as penning an open letter to Rachel Reeves.

In it, he addresses several “non-partisan issues of financial injustice,” asking to meet the Labour chancellor and her team.