Consumers are spending £3.6 billion on unsecured credit card cheques to pay their way through the as the industry rakes in more than £571m in interest and charges.

New figures from USwitch.com found that over 423,000 cash strapped consumers are using credit cheques to put cash into their bank account in an attempt to get by during tough times – a third of those are using them to consolidate debt.

The website has calculated that the average handling fee of one of these cheques is 2.5%, which equates to £28.49 on the average cheque for £1,141 – over 12 months interest and charges total £178.56 for every cheque used.

It says in total, 280 million credit card cheques have been issued in the last year alone, 97% of which have been unsolicited – almost 2.5 million people receive them from hopeful credit card companies once a month.

Louise Bond, personal finance manager at USwitch.com, says: "It is both alarming and concerning that so many consumers believe these cheques are ‘friendly freebies'.

“There are huge fees and interest rates associated with using them, which consumers need to be more aware of – particularly if they are using them to pay household bills or consolidate any debts. One of the biggest concerns however is that year on year the number of unsolicited cheques being sent out has stayed consistent, 13.7 million have been issued in the last year to people who did not ask for them.

"These quick fix solutions could turn into serious financial hangovers as they are one of the most expensive ways for people to get their hands on cash."

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