Store card clampdown

Retailers have agreed to a ban on inducements which tempt shoppers into signing up for expensive store cards.

As part of the government's review of consumer credit, they have pledged not to offer customers hefty discounts on the time when they agree to apply for a card.

Ministers were concerned that the inducements would result in people trapped with high cost credit.

Instead, any cut-price offers will only be available seven days after the application has gone in.

Stores will not be able to offer discounts, free gifts or similar incentives to encourage consumers to take out store cards at the point of sale, or for the seven day cooling-off period.

There will also be a ban on the payment of commission to shop staff for signing up shoppers for the cards.

Government statement:

"The package comprises three core features: a ban on direct commission to sales staff, a good practice training scheme and a seven day ban on retail incentives when a consumer takes out a store card. This ban will mean that stores will not be able to offer discounts, free gifts or similar incentives to encourage consumers to take out store cards at the point of sale, or for the first seven days. The introduction of the seven day ban on retail incentives will tackle the key concern raised by respondents, by de-coupling the decision to take out credit with an instant discount on a purchase.

"These measures will address the concerns raised by respondents and will be introduced from the second quarter of 2012, enabling consumers to benefit from the effects swiftly."