Imagine the scene: you're browsing through the clothes rails of your favourite shop or standing at the till waiting to pay for a new stereo when a face smiles from behind the counter and offers you an apparently amazing deal. It seems like a great bargain, especially if you're buying an expensive item. But what are you really getting into?

The pros of store cards

With store cards you're usually offered a tempting introductory offer, such as a first purchase discount or a free gift. After that the shop may give you a free quarterly magazine telling you about their new products, or invite you to preview evenings, where you have the chance to look at new stock before the general public. If you are very lucky, you may be given discount vouchers. Do not confuse these with loyalty cards or with ordinary credit cards offered by some shops, such as Marks & Spencer.

Store card cons

After your first purchase you don't normally get further discounts, which makes this an astonishingly expensive way to borrow. Although interest rates have fallen to almost nothing, the interest you pay on store cards remains a whopping 25-30% APR (annual percentage rate), compared to ordinary credit cards which charge 15-20% interest APR and can be used in other shops as well.

Who should use them?

To get the best value for money, only think about getting store credit if you have a favourite shop and can pay all your balance off in one go when the statement arrives. That way you get all of the perks and don't have to pay any interest. The few high street shops that don't take ordinary credit cards sometimes offer fairly good credit deals, but you still might be better off paying by using cash or debit cards.

If you're already in trouble

Take some advice from Laura, 23, who ran up such enormous debts on several store cards that the interest payments alone took up most of her monthly wages. "I took all my debts and put them onto one low interest credit card. The first six months were charged at a rate of 2.5% APR and gave me a chance to pay off most of the money and the ordinary credit card rate was so much cheaper, anyway," she says. "Don't get sucked in by the introductory offers on store cards, the rest of it is a con as far as I'm concerned."

Another solution

If it's going to take longer than a few months to pay off those debts, shop around for a low-interest loan and make regular monthly payments to get yourself back into the clear. If necessary, cut up your store card to avoid further temptation.

Updated: 09/01/2013