Consumer Debt Levels Still Rising Quickly
August 31, 2017
The overall scale of consumer debt across the UK continues to rise at a rapid rate despite the pace of growth having slowed slightly during July.
Official figures released by the Bank of England show that the pace of borrowing growth cooled in recent weeks but the country’s debt pile continues to rise at an annual rate of almost 10 per cent.
At 9.8 per cent, the annual rate of growth in consumer debt was tracked at a slower pace in July than during any month since April 2016.
However, that pace of growth was notably faster than it was during almost all months since the financial crisis of 2007/8.
Consumer spending is currently being constrained to a considerable extent across the country by inflation, which was recorded at 2.6 per cent in July.
Despite average wages rising at an annual rate of 2.1 per cent, the value of incomes across the country is effectively being diminished because inflation levels are rising that much more quickly.
Citizens Advice recently revealed details of its own research which found that roughly one in five people who are struggling to pay off their credit card debts have had their credit limits increased without request.
The charity has called for regulators to take action and better protect the tens of thousands of UK consumers who find themselves persistently dealing with credit card debt problems.
For its part, the charity StepChange is concerned that far too many Brits continue to use various forms of unsecured debt to cover their everyday expenditures.
“With stagnant wages and rising inflation squeezing household incomes further, a slight decrease in the rate of growth for consumer credit is no sign of relief,” said Peter Tutton from StepChange.
“These latest figures show overall consumer credit is rising by nearly 10 per cent annually and with people now getting into debt at a younger age and an estimated 8.8 million turning to credit to meet essential living costs, we must remain vigilant that a credit bubble is not history repeating.”
If you live anywhere in Scotland and you are finding it tough to cope with your debt problems for any reason then Scotland Debt Solutions can help. Contact your nearest SDS office to arrange a free consultation.