Britons Repay Their Unsecured Debt
29 September 2010 - Which Way To Pay

3.gif

Britons Repay Their Unsecured Debt

 

According to the Bank of England, Britons are repaying their unsecured loans rather than taking out new loans, emphasising a nervous attitude in the economy.

Borrowing, in all its forms, fell by £120 million which sees its biggest drop since November 2009.

The Bank of Englandís deputy governor, Charlie Bean suggested that those who are putting their money into savings and ultimately leaving it dormant, should change their tactics. He urged those persons with savings accounts to start spending in order to boost the economy.

The fact that people are not spending at the present, highlights a sense of caution that resides in Britons post-recession. People are happier leaving there money in low-interest savings accounts rather than moving it around and depleting their savings.

A fall in credit card borrowing, overdraft use and personal loans, make up the sharp decline in borrowing in the month of August. The news is worrying and casts doubts over the UKís recovering economy.

August also showed a decline in the number of mortgage loans that are being approved. A total of 974 less loans were approved in August. August constituted the fourth monthly drop.