Following the release of the BoE Money and Credit monthly statistics this morning, Paul Heywood, Chief Data & Analytics Officer at Equifax UK commented: “Consumers were dealt a triple blow to their finances in December, as inflation, the festive period and a widely debated base rate rise exhausted purse strings. Any consumer confidence that grew in November was quickly diminished, as demand for credit dropped and net borrowing of mortgage debt fell in line with November figures.
“We already knew that 1.7 million* households defaulted on or missed at least one rent, loan, mortgage, bill, or credit card payment in December 2021, so it comes as no surprise that households were unable to inject more money into their deposit accounts. Lenders must be mindful of these difficult circumstances and consider using Open Banking to spot the signs of financial difficulty in advance. Doing so will strengthen protection against overindebtedness and help consumers to make the most informed decisions when it comes to their spending.”