The rate of credit card lending rose again annually in September according to the latest data released by the Bank of England.
Credit card lending expanded by 9.2 per cent on the same month a year earlier, up from the rate of 8.9 per cent in August, and marking the fastest rate of rise since April this year.
Unsecured credit overall rose by ?1.6 billion in September, showing a slight decline in the annual rate to 9.9 per cent from the 10 per cent seen in August.
While the growth in unsecured consumer credit has slowed from the peak of 10.9 per cent recorded in November 2016, it is thought that the Bank of England was looking for a greater fall.
Last month the Bank’s Financial Policy Committee required commercial banks to hold more capital against this form of lending, and warned that lenders were underestimating their likely losses on credit cards if the economy took a turn for the worse.
Chief executive of Citizens Advice, Gillian Guy, said: ‘The rise and rise of consumer debt is a cause for alarm at a time when large numbers of people are already in financial difficulty.’
She continued: ‘The Financial Conduct Authority (FCA) must step in to curb the worrying rise in debt – by banning credit card firms from pushing more credit onto people who haven?t asked for it, and compelling them to offer support sooner when it?s clear people can?t pay.’
The latest figures released from the Bank of England also showed that there were 66,232 new mortgages for house purchases in September, down from the 67,232 in the previous month and below the 66,867 average of the previous six months.
The reduced mortgage figures could imply a slowing residential property market in the wake of the Brexit vote in 2016.
Despite concerns about the overall economy, the Bank of England is widely expected to raise interest rates for the first time in a decade today in a bid to rein in inflation, which hit a five-year high of 3 per cent in September.