Consumer borrowing to tumble in 2007

28 December 2006
A new report from Datamonitor predicts that the consumer credit market will soften in 2007 as UK borrowers take a realistic look at their finances.

The consumer credit market will grow at a rate of 4.5 per cent from 2006 to 2010, the report estimates, against 5.2 per cent in the last five-year period.

This weaker lending environment is expected to hit the retail sector as customers tighten their belts over the next few years - and lenders impose more stringent lending criteria.

But the debt accumulated over the last few years will still come back to bite borrowers, Datamonitor predicts.

In the immediate future, post-Christmas guilt could impel consumers looking to counter over-indulgence in more way than one to reach for the debt and diet self-help books, predicts James Scurlock in the Independent.

As American-style credit lending hit our shores, "I can say with absolute certainty that this year most Britons will have found themselves in more debt than ever", the author of Maxed Out comments.

But he argues that the biggest challenge for debtors is admitting that they have a problem and finding the right information to help them address it.

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