The final month of full lockdown saw the annual growth rate of outstanding credit card balances fall by 12.6% in the year to May, as consumers continued to pay down their credit card bills, new UK Finance figures have revealed.
May also saw credit card spending by UK cardholders slowly recover against the previous month, as the country moved past the initial shock of lockdown, with the total value of credit card transactions rising to £9.6bn from £8.7bn in April.
However, the value of spending on credit cards was 44.7% less than in the same month a year earlier, which the banking body suggested could reflect reduced demand for big ticket items often bought on credit. Debit card transactions saw a drop of 7.9% on the previous month, with a total spend of £47.7bn.
This was 7.8% lower than in May 2019, while overall, UK Finance indicated that card spending in the UK during May was down 39% year-on-year, as people continued to react to the impact of COVID-19.
“The pandemic continued to have a huge impact on how people spent their money in May, with restrictions impacting spending for both credit and debit card customers,” UK Finance managing director of personal finance, Eric Leenders, commented. “Maintaining the downward trend over the last few months, consumers continued to pay off their credit card balances in May.
“The banking and finance industry has a clear plan to help the country through this unprecedented period and has put in place a number of measures to help customers adapt to the new economic environment including the contactless limit increase to £45 and support for those struggling with their finances.”
The data showed that retailers across the country continued to encourage customers to use contactless payments, which drove £4.5bn of spending across 440 million transactions. This was an increase from 404 million in April. However, the figures also showed this was still down 39.1% from the same month in 2019.
“As the economy begins to open up, we anticipate spending levels to increase and the industry will continue to support customers to help them through this difficult and uncertain time,” Leenders added.
Latest News
NEW BUILD IN FOCUS - NEW EPISODE OF THE MORTGAGE INSIDER PODCAST, OUT NOW
Figures from the National House-Building Council saw Q1 2025 register a 36% increase in new homes built across the UK compared with the same period last year, representing a striking development for the first-time buyer market. But with the higher cost of building, ongoing planning challenges and new and changing regulations, how sustainable is this growth? And what does it mean for brokers?
The role of the bridging market and technology usage in the industry
Content editor, Dan McGrath, sat down with chief operating officer at Black & White Bridging, Damien Druce, and head of development finance at Empire Global Finance, Pete Williams, to explore the role of the bridging sector, the role of AI across the industry and how the property market has fared in the Labour Government’s first year in office.
Does the North-South divide still exist in the UK housing market?
What do the most expensive parts of the country reveal about shifting demand? And why is the Manchester housing market now outperforming many southern counterparts?
In this episode of the Barclays Mortgage Insider Podcast, host Phil Spencer is joined by Lucian Cook, Head of Research at Savills, and Ross Jones, founder of Home Financial and Evolve Commercial Finance, to explore how regional trends are redefining the UK housing, mortgage and buy-to-let markets.
In this episode of the Barclays Mortgage Insider Podcast, host Phil Spencer is joined by Lucian Cook, Head of Research at Savills, and Ross Jones, founder of Home Financial and Evolve Commercial Finance, to explore how regional trends are redefining the UK housing, mortgage and buy-to-let markets.
The new episode of The Mortgage Insider podcast, out now
Regional housing markets now matter more than ever. While London and the Southeast still tend to dominate the headlines from a house price and affordability perspective, much of the growth in rental yields and buyer demand is coming from other parts of the UK.
In this episode of the Barclays Mortgage Insider Podcast, host Phil Spencer is joined by Lucian Cook, Head of Research at Savills, and Ross Jones, founder of Home Financial and Evolve Commercial Finance.
In this episode of the Barclays Mortgage Insider Podcast, host Phil Spencer is joined by Lucian Cook, Head of Research at Savills, and Ross Jones, founder of Home Financial and Evolve Commercial Finance.
© 2019 Perspective Publishing Privacy & Cookies
Recent Stories