Abacus Daily Debt News

Credit card lending down as consumers ‘act with caution’

The level of credit card debt being built up in the UK is falling due to a more wary approach by Britons towards credit, it has been suggested.

Such a comment came from head of consumer finance at the Finance and Leasing Association (FLA) Fiona Hoyle, after the body produced figures showing the amount its members lent in September this year was six per cent down on a year earlier.

Credit card lending dipped eight per cent from September 2009 and storecard use was 22 per cent lower, while personal loans were down five per cent.

Ms Hoyle noted: "The new figures show that consumers continue to take a cautious approach to spending, with a decline in the amount of credit granted almost across the board."

The only area where credit increased was motoring finance, which was up two per cent.

Over the next couple of years it is unlikely banks and building societies will indulge in any "reckless" lending, UK economist at French bank BNP Paribas Alan Clarke remarked.

He suggested the greater risk is not enough will be lent.

By Joe White