The rate of UK consumer borrowing continued to slow in November according to the Bank of England as it seeks to slow down the growth of the personal loan market.The report shows a growth in consumer credit of 9.1 percent in the year to November 2017. Outstanding balances for consumer credit now stand at over £205.8 billion.
In response to the Bank of England’s latest Money and Credit data, Joanna Elson OBE, chief executive of the Money Advice Trust said: “Whilst the figures show a slight slowdown in the rate of consumer borrowing, outstanding balances on consumer credit are still over £205 billion – and this remains a concern.”
“We know from our own research that millions of Britons expect to fall behind with their finances this January as a result of Christmas spending. With this in mind, such high levels of consumer credit remain a concern as households struggle to make ends meet, with rising living costs and wages unable to keep up.”
“We would encourage anyone struggling with their finances to exercise caution before taking on any additional borrowing, and to make sure that you can cope with repayments in the event of a shock to your income. Look at your personal finances and where possible make a plan for 2018.”
Peter Tutton, Head of Policy at StepChange Debt Charity, said “While the rate of growth may have slowed, the outstanding amount of borrowing taken on by households continues to grow at a rapid pace. We know that millions of people are already using credit just to get by; while wages falling behind inflation risks leaving many more families vulnerable to debt. Helping the millions of households living on a financial knife edge must be a priority for public policy.”
“With the pile of outstanding credit card debt still growing, the Financial Conduct Authority (FCA) must ensure that its credit affordability rules are robust enough to ensure that what is designed to be a short-term lending product, does not trap people in long-term, expensive and potentially harmful cycles of debt.”
Consumer credit was up 9.1 per cent on the same month a year earlier, down from a peak of 10.9 per cent in November 2016