Credit card interest costs have increased by 80% since 2021

New data from Updraft has suggested that the average person in the UK has £1,400 in credit card debt in 2026, and will pay £342 on interest this year alone – yet 82% haven’t consolidated their debt.

The new figures, based on an analysis of Bank of England and ONS data, show that the average annual cost of credit card interest per adult has risen by around 80% since 2021, from £188 to an estimated £342 in 2026.

According to the study, 82% of credit card balances remain on higher‑rate cards rather than cheaper alternatives, meaning most people are likely paying far more interest than they need to. For the 6% who make only minimum repayments, the majority of their monthly payment goes straight to interest, trapping them in what Updraft calls the “Debt Drain”.

If nothing changes, the picture gets even bleaker. Based on their findings, Updraft warns that credit card interest could hit £25 billion by 2037, with total credit card debt reaching £100bn by 2053.

The average debt per adult could rise to £1,503 by 2054

Aseem Munshi, Founder of Updraft, said “For many people who are only able to make minimum repayments, a significant share of monthly payments can go towards interest rather than reducing the underlying balance. Over time, this can create what we describe as a ‘Debt Drain’ effect, where interest accumulates, and balances reduce more slowly. As a result, the total cost of borrowing can build significantly over time relative to the original debt.”