UK lenders expect record increase in access to unsecured loans

British five pound banknotes can be seen in this illustration photo taken on November 14, 2017. REUTERS / Benoit Tessier / Illustration / File photo

LONDON, July 15 (Reuters) – UK lenders expect a record increase in the availability of unsecured credit to households over the next three months as the country’s economy rebounds from the foreclosure crisis, revealed Thursday a Bank of England investigation.

Lenders also expect to increase the availability of new mortgages – although demand was expected to decline – while the supply of business loans remained unchanged.

The figures come from a quarterly survey of UK banks and mortgage lenders from June 1 to 18 and add to signs of a rapid recovery from the coronavirus pandemic.

UK consumer loans collapsed during the closures as people had fewer options to spend and millions of workers who might otherwise have been unemployed received child support on leave.

Previously released BoE data for May showed the first net increase in consumer borrowing since August, although separate figures for June released Thursday by the Office for National Statistics showed the first monthly decline since January in spending on cards. credit and debit. Read more

The expected increase in the supply of unsecured credit to households over the next three months was the largest since the survey began in 2007.

There has been an increase in demand for credit card loans and other types of unsecured debt with longer interest free periods on credit cards to attract borrowers.

Default rates on unsecured loans have fallen over the past three months but are expected to rise again.

Reporting by David Milliken; Editing by Kate Holton and William Schomberg

Our Standards: Thomson Reuters Trust Principles.

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