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Credit card usage has fallen significantly in the last year as shoppers turn to cash and debit cards to avoid borrowing and getting into debt. 

These are the findings of the British Retail Consortium (BRC) who say that credit card charges have dropped by 12.9%. In the same period debit card use increased by 15.8%.

The BRC Director General, Stephen Robertson said 'Hard pressed customers are switching to cash and debit cards for the reassurance that they can't spend what they haven't got.'

'At the same time use of credit cards has dropped sharply. Cash remains king - used for more than half of all retail payments.'

Bank credit card charges criticised

The BRC criticised the level of bank charges that are associated with credit cards. For retailers they are the most expensive transactions to process.

On average in 2010 UK retailers paid 1.7p per cash transaction to have money transported and banked. In comparison the average charge for processing a credit card payment was as high as 37.1p. Credit cards were used in 10% of purchases be accounted for almost 45% of processing costs.