Lending to consumers in Britain rose last month by the most in nearly five years, driven by a record rise in credit card borrowing, according to data that analysts said could be a sign of the growing cost-of-living squeeze.
Figures from the Bank of England on Tuesday showed consumer credit rose by a net £1.9 billion in February, much higher than predicted and the biggest increase since March 2017.
This increase of consumer credit was split between £1.5 billion of additional borrowing on credit cards, and £0.4 billion of borrowing through other forms of consumer credit (such as car dealership finance and personal loans).
The annual growth rate for all consumer credit increased to 4.4% in February from 3.2% in January; the highest rate since February 2020. The annual growth rates of credit card borrowing and other forms of consumer credit were 9.4% and 2.4% respectively.
Net borrowing of mortgage debt by individuals amounted to £4.7 billion in February. Mortgage approvals for house purchases fell slightly to 71,000 in February, from 73,800 in January, but remains above the 12-month pre-pandemic average up to February 2020 of 66,700.
