Consumer debt rose almost £800m in Q2

  • Story by: Gemma Westacott
  • Magazine: FTAdviser
  • Published Friday , October 10, 2008

Consumer borrowing increased to £5.9bn in the second quarter of the year, despite ongoing turbulence in the financial market and global economy.

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This marks a staggering £757m increase in consumer debt compared to the same period in 2007, according to Unbiased.co.uk.

At the same time, consumers' savings levels have dropped by £4bn, down from £42.9bn in the second quarter of 2007 to £38.5bn in the corresponding period this year.

Overall, for every £1 UK consumers saved during Q2 2008, they borrowed 15 pence (not including mortgage debt). This is up from 12 pence in Q2 of 2007.

David Elms, chief executive of Unbiased.co.uk, said: "With the credit crunch firmly gripping financial markets, it is now more important than ever for consumers to take control of their finances."

He added: "It is crucial that people take action now and make sure that they are taking control of their finances.

"Reigning in on spending and making sure that your savings are working hard for you are only the start of kick starting your finances."

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