Consumer Credit Decreases in all Areas of Lending
Consumers took out less credit in April, new figures reveal, as all areas of finance lending took a hit.
New purchases on store cards were down by 21 percent and new instalment credit taken out in shops was also down by 16 percent, figures released by the Finance & Leasing Association, the trade body for the consumer credit industry, revealed.
The Government is in the stage of drawing up plans for further changes in the credit market in the way credit it regulated, at a time when some parts of the credit market are already shrinking.
“Consumers are thinking very carefully before taking out credit and this is reflected in the fall in credit spending on the High Street,” said Fiona Hoyle, FLA head of consumer finance.
“Over the last five years credit providers have introduced extensive new rights for consumer credit customers. Any further regulatory change must not inadvertently impede recovery in the retail sector."
The figures reveal all areas of credit decreased in April from the previous year, as second mortgages decreased by 10 percent, direct unsecured loans by 17 percent and car finance by 8 percent.
According to research by The Co-operative Bank, 80 percent of the population have money worries.
Of all the living costs, utility bill hikes were revealed as causing the most angst with average outgoings £212 more than incomings at the moment.
All areas of family finances are being scrutinised with a view to save money, the study revealed, as the top money worries were utility bills, personal debt and fuel prices, with 21 percent, 21 percent and 15 percent agreeing respectively.
If you want to prevent getting into debt, and do not want to start borrowing money, then a prepaid card could help you budget and not overspend.