Credit card debt still being paid off

The level of credit card debt is still being kept down by consumers, despite a rise in spending during October.

Figures published today (November 23rd) by the British Bankers Association have revealed the level of credit card spending was £0.2 billion higher than in September at £7.2 billion.

The total number of credit card purchases was 116.3 million, up from September's tally of 114.5 million and the August tally of 113.9 million.

However, the actual amount paid back was £7.4 billion, maintaining a long-term trend of consumers looking to trim their credit card debts.

For example, in both August and September a total of £6.9 billion was spent and £7.2 billion paid off.

One reason the gap between the amount spent and that paid off may have been smaller and the overall level of spending higher could be the start of Christmas shopping as some sought to avoid doing it all at the last minute – perhaps as a budgeting exercise to help keep their monthly card bills in check.

This may account for the net growth in credit of £0.1 billion in the month, which also included a £0.2 billion rise in loans and overdraft use.

By contrast, both September and the average for the previous six months recorded a £0.1 billion fall.

The level of consumer spending on presents will be £430 per person this year, according to a survey published this week by classified adverts website Vivastreet.co.uk.

It said this would amount to £30 more than last year, despite the tough economic climate.

By James Francis