Credit cards relied on in times of income instability
By UK CreditCards.com
Consumers facing sudden changes in their incomes often depend on credit cards, new analysis suggested.
Chris Tapp, director of financial charity Credit Action, said that the cards are used to "smooth out peaks and troughs" in personal income, which can be caused by life events such as being made redundant. He added that many Britons would continue to be dependent on credit card borrowing in future.
Evidence from the Bank of England suggests that the credit card sector is bearing up well, despite the pressures of the financial crisis and economic downturn.
Figures for September 2009 from the institution suggested that overall lending on the cards increased by £79bn.
Mr Tapp said: "We are not seeing significant amounts of growth at all when it comes to credit card lending, but it is performing slightly better than other types of consumer credit."
Unemployment has been rising in the UK throughout 2009. It hit a new 14-year high of almost 2.5m according to latest official figures from the government.
Published: 30 October 2009
- Financial capability: Managing money and planning ahead – A recent report on financial capability based on six elements shows many Brits need to hone their financial skills. This short series will give tips on how to improve each area ...
- What we buy and how we spend: A decade of change – The Payments Council took a look back on the past decade in a February 2013 report, which found that Brits are splashing out on fun -- and moving toward a cash-free lifestyle ...
- Glimmers of optimism appear among financial gloom – With Christmas debt looming and warnings of a triple-dip recession in the headlines, you might think consumers are feeling pessimistic about their finances. But recent research shows otherwise ...