Banks have to lend money in order to make a profit and survive, reports Equifax.
External affairs director Neil Munroe stated that the possibility of banks ceasing lending altogether is an unlikely situation, adding that they are simply tightening the criteria of people who they will give
“They’ll continue to lend money but will just be a little more investigative when an application is being made to make sure that it’s the right person who’s going to repay them,” he explained.
Tightened lending criteria could result in a lower level of borrowing, remarked Mr Munroe, as prospective borrowers could be forced to take on the responsibility themselves.
However, this all depends on the individual and the circumstances, he added, as some people may be forced to go down a more expensive lending route.
As people are rejected by the main banks, they may have to seek help from the next tier of lenders, he said.
In February, secured lending grew by £7.4 billion and consumer credit lending by £2.4 billion, reports Credit Action.
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