Debt help: Lending rising despite economic worries

04/02/2010

Debt management or repayment plans may be called for as people continue to borrow despite their own uncertainty.

The latest figures from the Bank of England show that individuals are borrowing more than they are repaying, with a total of £1.2 billion being lent.

This figure is an increase of £0.1 billion on the previous six month average - the first rise since June 2009.

Credit card debt made up much of this with a total increase of £0.2 billion.

Ed Bowsher, head of consumer finance at Lovemoney.com, said that the figures indicate that "people are getting a bit more confident but they are still nervous".

Yesterday's (February 3rd) figures from the Nationwide Consumer Confidence Index also demonstrated a cautious sentiment among consumers as assurance was much lower than would historically be expected at this time of year.

EuroDebt director Kevin Still commented: "EuroDebt feels that the rise in credit card debt is potentially concentrated around those that need to use their credit card to make everyday purchases because they have insufficient disposable income.

"Creditaction's latest figures show that the average unsecured debt per household using credit has dropped below £19,000 from over £21,000 in the middle of 2009. But we are finding higher average levels of debt for people starting Debt Management Plans [DMP] with the average unsecured debt for an IVA being over £50,000."

Posted by Jim Mead

Tags; Debt Management and Banking,

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