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"Central bank deputy wants credit card firms to keep lending"

By admin | July 5th, 2009 | Credit Cards

The deputy governor of the Bank of England has said that it is important for credit card firms to continue lending in order to help pull the UK out of the ongoing recession.

Paul Tucker, the deputy governor of the central bank, was giving a speech the Association of British Insurers when he stressed the importance of credit card firms ensuring that they keep on lending in order to aid the economic recovery of the nation.

Whilst there have been a number of recent reports that have claimed that the UK is climbing out the recession, and that it could even become the first major economy in the world to do so, Mr Tucker said that the economic outlook was still very uncertain, and that issues like continued credit card lending were important in helping to maintain a more secure economic future for the UK.

Mr Tucker stated: “For the moment it is unclear – as, I must say, it is bound to be at this stage – whether the financial system can generate the expansion of credit that will most likely be necessary to support [economic] recovery. Not lending would be a counterproductive business and financial strategy.”

It is not just credit card lending to consumers that the deputy governor is trying to encourage, but also credit card lending to businesses, with many smaller businesses having struggled or even gone bust during the recession due to lack of finance from creditors.

Credit card lending, along with other types of lending, has become far more restricted since the onset of the global credit crunch in late 2007.

Tags: Association of British Insurers, Credit Cards

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