• Credit card spending rose 7.6% in the year
• The amount owed on credit cards rose 5.8%
The figures are included in the Household Finance update, here.
Laura Suter, personal finance analyst at investment platform AJ Bell, comments:
“There was a near 8% increase in the amount of money people were sticking on the plastic in August, compared to the same month last year. The warm weather and World Cup this summer led to a spending boom, but it looks like many have put off worrying about how they pay for their summer of fun.
“At the same time as the rise in credit card spending there has been a decrease in the use of overdrafts to fund spending. Some of this could be people shifting from expensive overdraft debt to a cheaper credit card, but for others the easy access to cheap credit will be fuelling their spending.
“However, we can’t just put this rise in debt down to people having fun in the sun, ultimately we have prices rising, wages stagnating and many people relying on debt just to get by. Outgoings outstripped income last year for the first time since the Eighties, so it’s no surprise that people are putting more on their credit cards.”