StepChange Debt Charity responds to the Bank of England’s latest Money and Credit statistics

^{30 January 2024}

New figures from the Bank of England released today show a fall in consumer borrowing of £1.2bn in December, while the effective interest rate on newly drawn mortgages fell by 6 basis points to 5.28%.

StepChange is warning that any apparent green shoots of recovery belie the fact that millions of people are still struggling to keep up and are at risk of falling into problem debt. New polling issued by the charity today reveals that 40% of people, around 22m people, are struggling to keep up with bills and credit commitments.

Richard Lane, Chief Client Officer at StepChange Debt Charity, said:

“While it’s encouraging to see consumer borrowing fall – particularly in December when Christmas spending is at its peak – the fact remains there are still millions of people struggling to meet the most essential of financial commitments and they are turning to borrowing as a result. Our research has found that one in eight people has borrowed to keep up with essential payments in the past twelve months, and with everyday costs like energy bills and groceries still soaring, we can expect to see more and more people turn to borrowing to make ends meet.

“The Chancellor has an opportunity in the Spring Budget on the 6th March to extend targeted support for low income households whose financial resilience has been eroded by two years of sky high prices across the board. In an election year, tackling such widespread problem debt and improving households’ financial security should be at the top of the current and future government’s agenda.”