Consumer borrowing continues to rise

Why has there been an increase?

Consumer borrowing on credit cards, loans and overdrafts rose in the month of December.

The British Bankers’ Association (BBA) saw a growth in annual consumer credit which hit 6.6 per cent last month, even though there were weaker sales in the shops during November.

The BBA, represents major High Street banks and said the increase came from cheaper personal loans.

The Bank of England has said it will keep an eye on personal debt loans.

Figures from the BBA show the net increase on consumer credit in December was £330m.

The BBA says despite the rise, the uncertainty in the economic and political climate could make consumers more aware leading to a safety-first approach.

Rebecca Harding, the BBA’s chief economist, said: “Overall, we’ve seen high levels of consumer and business borrowing, although there are early indications that 2017 could see softer demand for credit from business and households, as they anticipate future interest rate rises and wait for further clarity on Brexit,”

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