A report published today reveals that Britons have more plastic in their wallets than consumers in any other European country. The UK also accounts for almost two thirds of Europe’s credit card transactions.

Having overtaken Germany as the largest European card market in 2001, Britain now has 67 million credit cards in circulation — more than half of the number of credit cards in Europe.

Citizens Advice said that the findings, by Datamonitor, proved that credit card spending was exacerbating the growing debt crisis. About a third of the £180 billion of unsecured consumer debt in the UK is attributable to credit cards.

A spokeswoman for Citizens Advice said: “We find that credit card debts are the most common type of borrowing that over-indebted clients have when they come to our advisers for help.”

However, Kieran Hines, financial services analyst for Datamonitor and author of the report, said the findings were merely evidence of a cultural difference between the UK and continental Europe. He said that Britons were more comfortable “with the idea of card-based credit”.

Mr Hines added: “This is not to say that consumers in the UK borrow more heavily or are more indebted than their European counterparts, but that they prefer to borrow in a different way.” He said German consumers often had access to overdraft facilities up to three times their monthly salary, and made greater use of point-of-sale finance deals.

Datamonitor found the UK held 134 million of the 542 million payment cards in Europe, which include credit, debit and charge cards at the end of 2003.

The UK is now second only to the US in terms of the sophistication and choice available to credit card customers.

A recent report by PricewaterhouseCoopers (PwC), the accountancy firm, claimed the highly developed UK credit card market was “cannibalising margins” of card companies by creating “rate tarts”, who moved from issuer to issuer to finance debts at no cost.

Richard Thompson, of PwC, said: “Pressure is coming from a number of sources. There is a high cost of customer acquisition, which is demonstrated by the almost ubiquitous 0 per cent offers. Interest rate margins have been falling steadily over the past five years and card companies also face an increased regulatory burden with the updating of the nation’s 30-year-old credit laws.”

The rollout of chip and PIN — an anti-fraud scheme using a four-number PIN for card transactions — may lead to people disposing of some cards because of the difficulty of having to memorise the individual PINs, according to PwC.

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