Author Topic: Credit card lending hits record high of £8.4billion in a month (UK)  (Read 921 times)

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Offline kelee877

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Credit card lending hits record high of £8.4billion in a month: Four million transactions every day are processed

Some people use their card to pay mortgage or the weekly food shop

Experts fear figures mean millions are ‘surviving day-to-day’ on credit

Britons owe a total of  £38.7billion on their credit card -  an all-time high

Consumers borrowed a record-breaking £8.4billion on their credit cards last month, official figures revealed yesterday.

More than four million transactions a day are being processed in the UK, with some people using their card to pay their mortgage or weekly food shop.
Experts warned the figures, from the British Bankers’ Association, raise fears that millions are ‘surviving day-to-day’ on credit.

Overall, the figures show the total that Britons owe on their credit card, has reached an all-time high of £38.7billion.

In August 2007 – the month the credit crunch began – £7.2billion was borrowed on credit cards and the total outstanding was £29.4billion.
The BBA said the credit card boom is a sign of a ‘growing consumer confidence’ among Britons following a time when they were too scared about the future to take on debt.
But debt experts warn spending on credit cards is a classic sign of financial distress because it is one of the easiest ways to obtain money.
Unlike a personal loan, which must be approved by a bank or building society, it is easy to borrow money on a credit card, typically ‘maxing out’ the card by borrowing up to your credit limit.
Mark Sands, head of bankruptcy at the accountants RSM Tenon, said ‘the more desperate type of borrowing’ is done on a credit card, rather than other types of borrowing.

He said: ‘Those who are still struggling are using credit card debt as a way of surviving day-to-day.
‘If you have kept a couple of credit cards in the bottom of your drawer, but you’ve now lost your job and your bills are going up, you can max out your credit cards.

The credit card boom is not the only sign of millions of people being forced to rely on debt to survive., the controversial pay day loan firm, is handing out 10,400 loans every single day, lending up to £1,000 which arrives in your bank account within minutes.

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