The recession is having an impact on all aspects of people’s lives, but one that is perhaps more surprising than others is the fact that UK consumers are striving to pay off their debts more than ever before.
The statement, made by Equifax, is backed up by figures released by the Bank of England in early May, which showed a 2.2% drop in lending in the last year.
Rather than continuing with the ‘spend now, pay back later’ attitude, many Brits have taken a serious look at their financial situation, drawing up budgets and restricting themselves to splashing out with cash that is theirs, not borrowed on cards or overdrafts. The fact that many feel their job is no longer secure due to the current economic climate may be a factor, as well as the media’s huge focus on the UK’s mounting personal debts.
New figures from the UK Payment Association, APACS, also support the claim, as credit card lending stood at £30.3 billion in the first quarter of 2009, with repayments at £29.6 billion.
As the UK’s total personal debt currently stands at £1,495, experts have warned consumers to take on a more stringent approach if they hope to weather the recession.