The Bank of England has published its latest monthly Money and Credit report showing a slight jump in growth in consumer credit of 9.4 percent in the year to February 2018, up from 9.3 percent in January. Outstanding balances for consumer credit now stand at over £209.4 billion.
Joanna Elson OBE, chief executive of the Money Advice Trust, said “Despite consumer credit balances now standing at over £209 billion, at present this is unlikely to be an issue for the majority of households able to meet repayments. Our concern is of a growing risk of difficulty for those households already struggling with rising living costs and slow wage growth.”
“All too often it takes just one change in circumstances, such as a job loss or a relationship breakdown to push people into financial difficulty. At National Debtline we already hear from thousands of people struggling to meet daily costs, with nearly one in three are already struggling with credit card debt and one in seven are struggling with loan repayments.
Commenting on Bank of England data Peter Tutton, head of policy at StepChange Debt Charity, said “Consumer credit lending growth continues apace, and once again credit card lending growth leads the pack. With the prospect of higher interest rates ahead, now is surely the right time for policymakers to look hard at what else they can do to head off a predictable increase in problem debt before it happens. Too many people are carrying the burden of persistent credit card and overdraft debt. We estimate 1.4 million households used high-cost credit last year for basic living expenses. This creates a debt spiral and further public policy intervention is needed if we are to solve it.”