This decade has witnessed conspicuous increase in a British adult’s debt almost by 50% with each adult having about £4,000 outstanding in loans, overdrafts, credit cards, store cards and finance deals this year, against £2,767 in the year 2000.
The money due on credit cards accounteds to approximately £1,302 on credit cards, £1,892 in unsecured personal loan balances and £812 on overdrafts and motor and retail finance deals by each adult.
Analysts say that data-sharing between lenders and records of mortgage arrears serve as ineffectual debt monitors and stand to be blamed for the unleash of such rampant borrowing behaviour.
Datamonitor revealed that even five interest rate raises in November 2003 had proved futile in stunting consumer borrowing tendencies. It said that bad debt indicators like mortgage arrears, unemployment, repossessions and county court judgments had perhaps served as incentives for raising consumer confidence regarding repayment of their debts, and had thereby led to effortless borrowing.
However, the credit card debt that accounted for £119.2bn of the total new consumer credit business transacted last year continues to be a cause of constant worry. Therefore, borrowers have been recommended to be wary about their card debts, keeping in mind the obscure future of the property sector. That may well be able to drop credit growth to 4.7% by the year 2009.
Posted
on : Sat, 12 Mar 2005 00:00 GMT | Debt News
By : Pippa Fielding
|
