27 August 2008
Consumers are borrowing more on credit cards as unsecured personal loans become increasingly difficult to obtain, research by uSwitch.com has revealed. The independent price comparison and switching service found that gross credit card lending has risen by an average of £179 million per quarter over the last year. At the same time, the overall amount issued in unsecured personal loans has fallen by £283 million each quarter. Credit card debt currently stands at £54.9 billion, owed by 30.8 million consumers on 67.3 million cards, the data shows. Simeon Linstead, Head of Personal Finance at uSwitch.com, said consumers seem to be turning to plastic in response to the restricted availability of other forms of credit. "Whilst it's good news that people can still access extra money if they need it, this is not a sustainable solution for the problem," he warned. Although personal loans are harder to find and more expensive than they were previously, there are still some competitive deals to be found online, he added. Figures from the UK payments association Apacs show that UK consumers spent £92.6 billion on credit and debit cards in the second quarter of this year.
© 2008 Adfero Ltd
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