CONSUMER credit declined for the first time since 2013 as households scaled back borrowing in January.
Figures from banking trade body UK Finance shows the value of consumer credit – incorporating loans, credit cards and overdrafts – fell 0.2 per cent last month.
The amount borrowed on personal loans fell 15.7 per cent annually to £1.7bn in January.
Meanwhile, credit card spending increased by 5.8 per cent year-on-year to £10.4bn, but the total amount owed on credit cards grew by 4.8 per cent, a slower pace than the 5.3 per cent a month before and 6.1 per cent in January 2017 as more people focused on paying off their Christmas debts, UK Finance said.
Consumer credit growth last fell in July 2013.
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The data, based on activity from the main high street banks in the UK, showed businesses and households saved more in January but borrowed less.
The value of business deposits grew seven per cent year-on-year in January to £363.9bn, while personal savings were up 2.2 per cent to £834.9bn.
However, cash ISA savings by individuals were down 4.5 per cent in January to £156bn.
“January saw higher levels of repayments on credit cards, which is expected at this time of year as customers pay off their festive spending,” Eric Leenders, managing director of personal finance at UK Finance, said.
“Meanwhile, households were careful with their outgoings as wage growth remains below the inflation rate.”