Young adults and homeowners driving surge in subprime credit

New analysis of 24 million subprime credit applications conducted by Data On Demand in partnership with the University of Salford Business School and Seattle Pacific University has found that young adults and homeowners driving surge in subprime credit,

The analysis revealed a significant shift in borrowing patterns, with essential living costs replacing discretionary spending as the primary reason for credit applications. 

The data show that applications from young adults (18–24) are three times higher than other age groups with ehe average applicant income at £22,962—31% below the UK average.

23% of applications come from repeat borrowers, while 77% were first-time applicants.

The data also found significant regional variations in credit demand. Areas such as Doncaster (41.6%), Nottingham (24.6%), and Liverpool (21.9%) show application rates far exceeding those of major urban centres. Some regions highlighted application rates above 40% of the adult population.

Stuart Murgatroyd, CEO of Data On Demand said “The shift from discretionary to essential expense borrowing signals important changes in consumer circumstances. When employed individuals with stable housing repeatedly seek credit for utility bills rather than lifestyle purchases, it indicates growing financial pressure that traditional credit data might miss.”

Dr. Pål M. Vik, Senior Research Fellow at the University of Salford Business School, said “These findings provide important insights into changing consumer credit needs. We’re seeing employed, responsible individuals facing genuine affordability challenges, suggesting broader economic pressures at work.”