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Credit Card spendature sees a decline

According to statistics, consumers are not signing-up for new credit cards resulting in stores seeing a recorded drop of 21% in sales during March. Even credit card expenditures are down by 8%.

The statistics were made by the Finance and Leasing Association (FLA). Costs are higher so consumers are reticent when it comes to spending, borrowing or paying by credit card.

Fiona Hoyle from the FLA believes that people don’t trust the economy like they used to.

Research made by Halifax showed that common house costs have gone up by 1.4% since 2010. This appears to be bad news because interest rates have remained the same for more than two years.

Inflation also represents an important factor as both food and energy costs showed an increase. The current rate is 4.5%, but even transport is seriously affected by this growth.

London is the most expensive city in the UK in terms of house costs per year. The highest recorded prices appear to settle at almost £11,780, while in North East are lower at £7,400.

This March about £2,530 million were borrowed by consumers in order to help them pay their daily needs. It is easy to see why such exorbitant sums can scare the common consumer into hiding from credits.

Ms Fiona Hoyle said that some consumers may still want to take credits in order to pay for certain things. She said: “Despite consumers taking a cautious approach to spending, FLA members lent £4.8 billion to customers in March for household essentials, such as furniture, clothes, food, fridges and other electrical items.” These are things which people need to have in order to survive and it is completely normal to ask for a credit if there is a shortage.

People prefer to put an end to their debts and then save the money in order to avoid another credit card.

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