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"Improvements to credit card lending"

By Reno | September 2nd, 2010 | General

According to recent reports July saw improvements when it came to credit card lending in the UK, which many believe shows that there are tentative signs of recovery in the UK economy. Figures have been released by the Bank of England, showing that lenders have been willing to extend slightly more credit to consumers recently.

The central bank indicated that credit card firms had been willing to lend slightly more to consumers over the month of July, with credit card lending increasing by £0.2 billion. This has been seen as a positive sign for the industry, for consumers, and for the economy, even though the increase in lending levels is only a small one.

This is a far cry from the situation just a couple of years ago, when the nation was still in the grip of the financial crisis and recession, and when credit card lenders were rejecting up to eighteen thousand credit card applications every day. During that time close to two million borrowers saw their credit card limits reduced, as lenders panicked over bad debt and defaults.

As a result of the restrictions and tight lending conditions that were seen during that time credit card use fell by around one million. However, some of the offers that are coming out now from credit card firms are said to be even better than they were prior to the recession, which many believe indicates that lenders are regaining confidence with regards to repayment of debt by consumers.

However, whilst the extended credit and special deals that are now being marketed by credit card firms may be seen as good news by many people, there are a number of officials and industry groups that believe lenders may be tempting people to get into even more debt as a result of these offers.

Tags: Bank of england, finance, Credit Cards, credit card

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