BoE Money and Credit – insight and analysis

Following last week’s Bank of England Money and Credit announcement, David Finch, chief revenue officer at TransUnion UK has given his thoughts on what the figures mean and the reasons behind the changes.

He said: “The latest Money and Credit statistics from the Bank of England depict a resilient economy, despite the impending general election and continued Brexit negotiations. Consumers borrowed £1.3 billion in October to purchase goods and services, with annual growth at 6.1%, up from 5.9% in September. This is the first increase since June 2018, indicating that consumers are gaining in confidence.

“That said, with the holiday season approaching, we’re likely to see this growth increase, and there is a danger of consumers overextending themselves – particularly with the use of credit cards which saw net borrowing rise by £0.3 billion in October – so lenders need to be rigorous in their affordability checks to avoid that happening.

“The mortgage market annual growth rate remained steady, with lending up £0.4 billion from September – a positive sign given the wider political uncertainty. However, a slight decline in mortgage approvals could suggest an impending decrease in house purchases. That would be unsurprising as we head towards to the new Brexit deadline but equally may just be an affirmation that mortgage lenders are scrutinising applications to ensure prospective buyers can sustain their payments in the long term.”