August Breaks UK Credit Card Record as Balances Soar
Key Highlights
- ➤Average UK card balance hit record £2,005, up 1.2% month-on-month
- ➤Average card spending rose 3.1% month-on-month to £840
- ➤Payment-to-balance ratio fell to 33.3%, down 3.1% year-on-year
- ➤Three-missed-payment accounts jumped 16.4% year-on-year
- ➤Average credit limits exceeded £6,000 for the first time
FICO UK Credit Card Market Report suggests risk teams must closely monitor payment rates and overlimit usage as rising inflation adds to financial pressure for consumers
According to data analysis from global analytics software leader FICO (NYSE: FICO), average active UK credit card balances exceeded £2,000 in August for the first time since records began, following three consecutive months of increases. Contributing to higher balances, payment rates dropped after a brief recovery in July, and remain lower than the same time last year. This trend, coupled with an annual increase in all levels of missed payments, highlights the importance of risk teams continuing to closely monitor for signs of financial difficulty.
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