UK credit card debt soars: a worrying new trend?
People borrowed £1.5bn on credit cards in February, the highest monthly amount since records began

UK consumers borrowed a record amount on credit cards in February, prompting one economist to speculate that the economic recovery “is about to shift down a gear”.
Data published by the Bank of England showed that individuals borrowed a net £1.5bn on credit cards, the highest monthly amount since records began in 1993, noted This Is Money.
The figure was more than three times higher than the average of £400m borrowed in the previous six months, pushing total consumer credit, which includes personal loans and car dealership finance, to £1.9bn net - the highest level in five years.
Subscribe to The Week
Escape your echo chamber. Get the facts behind the news, plus analysis from multiple perspectives.

Sign up for The Week's Free Newsletters
From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.
From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.
Meanwhile, the latest fortnightly survey by the Office for National Statistics found that 12% of respondents were using credit cards more than usual to cope with increased prices in the first half of March. The proportion rose to 18% for those aged 30 to 49 and to 21% among renters.
The Financial Times noted that although consumer borrowing is usually considered “a measure of spending growth”, with inflation at a 30-year high and falling consumer confidence, some believe it is a sign of consumers “falling into debt to maintain their standard of living”.
“The big rise in consumer borrowing in February likely reflects households attempting to maintain their consumption at a time when real disposable income is falling sharply, rather than them going on a spending spree,” said Samuel Tombs, chief UK economist at consultancy Pantheon Macroeconomics.
He added that the figures “suggest that the economic recovery is about to shift down a gear”.
A free daily email with the biggest news stories of the day – and the best features from TheWeek.com
Thomas Pugh, UK economist at the accountancy firm RSM UK, agreed, saying the latest figures “suggest that consumers are increasingly borrowing more to protect their lifestyles from the surge in inflation”.
However, said The Guardian, some experts believe the increase in credit card spending, which followed the lifting of restrictions related to the Omicron variant, might show a renewed confidence among consumers before Russia’s invasion of Ukraine.
Paul Dales, the chief UK economist at the consultancy Capital Economics, said: “It is more likely that households had the confidence to borrow and spend a bit more and/or were willing to use borrowing/savings to smooth their spending.”
Therefore, predicted Dales, “the economy may have a bit more near-term momentum than we thought”.
Anti-poverty charities remain concerned. Joanna Elson, the chief executive of the Money Advice Trust, the charity that runs National Debtline and Business Debtline, said the figures provide “an indicator of the underlying challenges households face in meeting the growing cost of living”.
Calling on Rishi Sunak to provide more help for under-pressure householders, she added: “Our concern is that more people will be pushed to credit to cover rising bills, which could be storing up problems further down the line when repayments are due.”
Chas Newkey-Burden has been part of The Week Digital team for more than a decade and a journalist for 25 years, starting out on the irreverent football weekly 90 Minutes, before moving to lifestyle magazines Loaded and Attitude. He was a columnist for The Big Issue and landed a world exclusive with David Beckham that became the weekly magazine’s bestselling issue. He now writes regularly for The Guardian, The Telegraph, The Independent, Metro, FourFourTwo and the i new site. He is also the author of a number of non-fiction books.
-
Delhi's dogs earn Supreme Court reprieve
IN THE SPOTLIGHT After an outcry from the public and animal rights activists, India's Supreme Court walks back a controversial plan to round the city's stray dog population into shelters
-
8 hotels with ace tennis courts
The Week Recommends Bring your A game
-
Abrego released from jail, faces Uganda deportation
Speed Read The wrongly deported Kilmar Abrego García is expected to be detained at an ICE check-in and deported to Uganda
-
What is an upside-down car loan and how do you get out of it?
the explainer This happens when the outstanding balance on a car loan exceeds the vehicle's worth
-
How can you borrow less for grad school?
the explainer Borrowers will soon face stricter limits on federal student loans. But there are other ways help cover the cost of grad school.
-
How do your student loans affect your credit score?
The Explainer People's scores are dropping as student loan payments resume
-
Withdrawing 529 plan funds for college? Here's what to know.
the explainer Maximize the amount you have stashed away for your education
-
What to know as student loan collections resume
the explainer The restart comes as part of the Trump administration's reversal of Biden-era policies
-
What to know before lending money to family or friends
the explainer Ensure both your relationship and your finances remain intact
-
Income-driven repayment for student loans: how it works and alternatives
The explainer IDR can make a big difference in the affordability of federal student loan payments
-
How to pay off student loans
The explainer Don't just settle for the default repayment plan