Latest News Headlines
Commercial Credit News
|Borrowing falls for the first time since 2011|
|Tuesday, 02 February 2016|
People in the UK owed £1.455 trillion at the end of December 2015, this is down £4.7 billion from November. That’s not much compared to the growth of nearly £200 billion in the last four years, but it is the first time that there has been a significant fall in that period.
In the last year the amount people owe increased by £627.09 per UK adult, £194.41 of which is unsecured lending such as credit cards or loans. We also know that savings rates are at a near record low of 4.4% and that around 9.61m (36%) households have no savings, while a further 3.47m (13%) have under £1,500.
Rising debt is not necessarily a bad thing. Credit usually grows when people are feeling better about their finances and falls in times of difficulty and insecurity.
But The Money Charity has been particularly concerned that 82 months of 0.5% Bank of England base rates has allowed debt to build up and deterred saving, leaving many consumers in potentially difficult positions. We would remind borrowers that while repayments may be manageable month-to-month today, you should always have a plan to pay back to sum you have borrowed.
Michelle Highman, Chief Executive of The Money Charity said: “There is nothing necessarily wrong with borrowing. It is a good way of paying for things you can’t afford up-front like university or your house. But debt becomes a huge problem if we can’t afford the interest and repayments – so we welcome this dip in borrowing and hope it is sustained”
“Assuming that interest rates we pay today will always stay the same sets you up for financial troubles. If rates change, particularly if you have variable interest debt, you will face considerably higher repayments that you may not be able to meet.”
“So it’s especially important to stay in control of your borrowing, and there’s help available at an early stage if you’re in difficulty.”
“If your debt feels too much to deal with, there’s free, impartial advice available from charities like StepChange.”
Other figures in February’s Money Statistics include:
The average interest rate for an instant access savings account – not including bonus interest payments – was 0.38% in December. For a cash ISA, this was 0.68%.
During November 2015 an average of 453 purchases were made in the UK every second using debit and credit cards, based on figures from the UK Cards Association.
In January 2015 the average price of unleaded petrol fell by 2.15ppl (pence per litre) to 102.23ppl.
502,000 18-24 year olds (12.3%) were unemployed between September and November. This was 42,000 (7.7%) fewer than the previous three months.
325,000 people aged over 50 were unemployed between September and November. This is down 1.7% from the previous three months, but up 0.2% on a year earlier.
Forums International Ltd
Attendance at your first meeting is free of charge, and please quote reference 'CCR2016' to receive the special 10% discount off of your first annual subscription.
Find out more here.
The latest edition of CCR Magazine, the leading editorial publication in the UK credit industry, is out.
CCR is the premier magazine for consumer and credit professionals. It provides an independent voice to the industry, breaking major news stories and running in-depth features.
As a magazine, it works with and campaigns on behalf of the credit industry to promote its importance as a centre of potential profit and business development to the wider business world.
Providing information and analysis for thousands of senior credit professionals worldwide, every quarter.
GTS Media Ltd
81 Cambridge Road
Registered in England No: 05483197