Consumer caution is earmarked in a new report as the reason why lending for personal loans has decreased for the second quarter of this year.
The report, issued by Nationwide Building Society, is the first report of its kind to separate personal lending figures from general unsecured loans figures including credit cards and overdrafts.
It shows that personal lending figures for the second quarter of this year are down by 9.2 per cent in relation to the first quarter, and 8.2 per cent lower than the second quarter of 2004.
Analysts put this down to people being more aware of the potential pitfalls of being in too much debt.
Stuart Bernau, Nationwide executive director, commented: “It’s likely that, with relatively high levels of indebtedness, consumers are heeding the warnings around committing their personal finances, as well as naturally ‘hitting the buffers’ in terms of what they can afford.”
Personal lending is not the only area of the unsecured loans market experiencing a dip in figures, as credit card borrowing is also down.
However, the secured loans market has seen a rise in mortgages and remortgages, which has boosted August lending figures.
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