UK CREDIT card borrowing soared to £1.2bn last November — the highest level since 2004 — and research from Forbes Advisor shows 29 percent of people use cards to feed themselves and their families.
In 20 percent of British households, income no longer covers monthly outgoings. Families are forced to use “borrowed money” to keep the lights on and pay for bills and transport.
Reliance on credit varied across UK regions. In Southampton, 35 percent of people are using credit cards for essential expenses such as transport costs. In Belfast, 32 percent rely on plastic to pay for gas and electricity bills.
And consumers are using credit at an increasingly young age. The average person over 55 signed up to their first credit card at the age of 32. This compares to 23 for 18- to 34-year-olds.
One area causing headaches is an inability to define a credit score; 39 percent of the population feel challenged by this, and don’t know where to find their rating. Four percent admit to relying on sources such as Wikipedia for information — and 37 percent say they would never seek help. Older respondents are most likely to go it alone, with more than half of over-55s rejecting offers of assistance.
Forbes Advisor expert Laura Howard says a credit card is “a great servant but a terrible master”. She says it’s concerning that almost a third of people rely on them to buy groceries.
“With the effective credit card interest rate now at 19.24 percent … this only exasperates affordability problems for households,” she said.