COVID-19 has prompted a sharp increase in one-off purchases, with more than half of Brits (53%) splashing out on an item worth over £200 that they wouldn’t have normally bought, according to research from Indesser1 – a joint venture between the Cabinet Office and TDX Group.
A further third of people (31%) treated themselves to one-off purchases over £200 on multiple occasions. Of these, clothes were the top purchase in UK shopping baskets, followed by a new TV, mobile phone, a car and shoes.
A quarter of respondents (25%) reported their income had decreased, while 78% claimed their spending levels remained equal, or had even risen. Of these, nearly one in nine said their spending had increased significantly, pointing to a growth in disposable finances for many as Britain continues to live under COVID-19 restrictions.
Paul Verner, Interim CEO of Indesser, said: “COVID-19 has taken an immeasurable toll on our society, but for those unaffected financially the restrictive nature of lockdown has boosted their disposable income. By contrast, the pandemic continues to intensify the pre-existing financial divide in the UK, with many struggling to get by and the underlying debt situation remaining highly complex.
“Almost a third of Brits (29%) are increasingly reliant on borrowing to make ends meet. Despite hopeful signs of future economic recovery sparked by vaccine progress, with forbearance planned to end in the spring, a significant debt surge is on the horizon. In these circumstances, it’s imperative that creditors stand prepared to carefully and effectively manage those facing financial vulnerability, drawing on powerful data insights to create the best outcomes from start to finish of the customer journey.”