Demand for debt among UK consumers is being constrained by the range of pressures on personal finances, it has been suggested.
According to the latest assessment from the British Bankers’ Association (BBA), fewer people are applying to their high street lenders for unsecured loans and credit card debt.
In addition, lenders have become more reluctant to offer unsecured loans, as well as mortgages, to people who do make the relevant applications, says the BBA.
As a result, the rate of consumer borrowing growth dipped by £0.2 billion during March and mortgage lending growth fell twice as far in the same period.
“The consequences of low banking sector liquidity show up clearly in March data; reduced product ranges and tighter criteria resulted in slower mortgage lending and significantly fewer loan approvals,” said the BBA’s statistics director David Dooks.
Last week, the Council of Mortgage Lenders indicated its own expectation that borrowing rates will slow across the country over the course of the next few months.