Store cards and catalogue credit are common forms of revolving credit — but they often carry high interest rates and minimum payment traps that can make balances grow slowly. This page explains the key things to know, general guidance only.
A store card is a form of revolving credit offered by a retailer (or in partnership with a lender) that can usually only be used at that retailer. Like a credit card, you have a credit limit and make monthly payments. Store cards typically carry higher APRs than standard credit cards — often 25-40% or more. They are regulated consumer credit agreements.
Catalogue accounts allow you to order goods and pay over time, either monthly or in instalments. Common catalogue providers in the UK include Very, Littlewoods, Next, and Studio. Interest rates are often high, particularly on minimum payment arrangements. These are also regulated consumer credit products.
Store cards and catalogue accounts typically require only a small minimum payment each month. This can seem manageable, but if you only ever pay the minimum, the majority of your payment goes toward interest rather than reducing the balance.
Illustrative example (not a quote): A balance of £1,000 on a store card at 39.9% APR, paying only the minimum each month, could take well over 10 years to clear and cost significantly more than the original balance in interest alone. The exact figures depend on the specific terms of the account.
If you can afford to pay more than the minimum each month, doing so will reduce the balance faster and cost less in total. If you cannot afford more than the minimum, contact a free debt advice service — there may be options available to help.
Under FCA rules introduced from 2019, lenders must identify customers who have been in persistent debt — meaning they have paid more in interest and charges than in repayments — over an 18-month period. When this is identified, the lender must:
If you receive a persistent debt notice from a lender, take it seriously. It is a signal that the account is costing you significantly more than the value of what you bought. Contact a free debt adviser to explore your options.
Do not wait until you have missed several payments. Contact the store card or catalogue provider as soon as you know you are going to struggle. Under FCA rules, lenders must treat customers in financial difficulty fairly and consider options such as temporary payment breaks or reduced payment arrangements.
Ask the lender whether they can freeze interest and agree a reduced payment plan while you get back on your feet. Many will — particularly if you can show genuine hardship. Get any agreement in writing.
If the store card or catalogue debt is part of a bigger picture — or if you are struggling with multiple accounts — contact a free debt advice service. They can help you prioritise debts, negotiate with creditors, and explore longer-term solutions.
If you miss payments consistently, the lender will issue a default notice giving you 14 days to pay. If you do not pay, the account defaults. A default appears on your credit file for six years and can affect your ability to get credit. Once defaulted, the debt may be sold to a debt collection agency.
A default is recorded on your credit file when you fail to make required payments and the lender closes the account. Defaults stay on your credit file for six years from the date of the default. During this time they can affect your ability to get a mortgage, loan, credit card, or even some rental agreements.
After six years, the default drops off automatically. The passage of time — and keeping other accounts up to date — is the primary way credit files recover after a default. Credit repair companies claiming to remove legitimate defaults are unlikely to succeed and may charge significant fees. Free advice from Citizens Advice is a better starting point.
If you believe a store card or catalogue provider has treated you unfairly — for example by not following persistent debt rules, charging incorrect fees, or failing to treat you fairly when you notified them of financial difficulty — you can make a formal complaint.
A store card is a form of revolving credit offered by a retailer or in partnership with a lender. Like a credit card, you can spend up to a credit limit and pay back monthly. Store cards typically have higher interest rates (APR) than standard credit cards. They are regulated consumer credit agreements under the Consumer Credit Act 1974.
Store cards and catalogue accounts usually require only a small minimum payment each month — sometimes as low as 1-2% of the balance or a fixed minimum amount. If you only ever make the minimum payment, the majority of your payment covers interest rather than reducing the balance. A balance of a few hundred pounds could take many years to clear and cost significantly more in interest. The FCA introduced rules in 2019 requiring lenders to intervene when customers are in persistent debt.
Under FCA rules, if you have been paying more in interest and charges than you have been paying off the debt itself over an 18-month period, the lender must contact you. They must offer help, warn you of the consequences of continuing to make only minimum payments, and propose a way to help you repay more quickly. If you receive this notice from a lender, it is an important signal — contact a free debt advice service.
Missing a payment will usually result in a late payment fee (capped at £12 for regulated consumer credit products). Continued missed payments can lead to a default notice, which gives you 14 days to pay before the account defaults. A default is recorded on your credit file and can affect your ability to get credit for up to six years. If you are struggling to make payments, contact the lender and/or a free debt advice service as soon as possible.
Complain in writing to the provider's complaints team. They have 8 weeks to provide a final response. If you are not satisfied with their response, or they have not responded within 8 weeks, you can refer the complaint to the Financial Ombudsman Service (FOS) for free at financial-ombudsman.org.uk or by calling 0800 023 4567.
Use Ask Fin's free budgeting tool to see how store card and catalogue repayments compare to your monthly income and other outgoings. General educational tool only — not a substitute for regulated advice.
Try the budget tool