Credit card spending steady as mortgage lending plummets

by Gill Montia

Story link: Credit card spending steady as mortgage lending plummets

The British Bankers’ Association (BBA) has published figures for August which show credit card spending holding steady at £7.3 billion, in line with recent monthly averages.

Consumers repaid £7.4 billon during the month but the total outstanding debt rose by £400 million, to £33.6 billion, once interest and charges had been included.

According to the BBA, borrowing on overdraft fell slightly and gross unsecured loans remained subdued during the month; personal deposits rose by just £0.3 billion after a small drop in July.

Turning to mortgages, BBA members, which account for two-thirds of the UK’s mortgage lending, approved 21,086 loans for house purchases during August.

The figure, which is 5% down on July and 64% down on a year earlier, is at its lowest since BBA records began in 1997.

Approvals for remortgaging were 27.8% down year-on-year, at 47,765 and at their lowest since early 2001.

Net mortgage lending (gross lending minus repayments and redemptions) rose by £2.1 billion in August but the rise was less than half the monthly increase over the six months to the end of July.

Finally, last month’s approvals for equity withdrawal and buy-to-let loans were 35.3% lower than in August 2007.