The December trend to cut back on credit card spending continued apace with a £496 million cutback in spending on credit cards from increasingly careful spenders.

Meanwhile, new borrowing on credit cards totalled £7,239 million for the month, seven per cent lower than in January 2006.

“Prudent repayments, particularly on credit card accounts, are keeping the unsecured credit picture very subdued,” David Dooks, the BBA’s director of statistics, commented.

Meanwhile, unsecured lending on products such as loans and overdrafts rose by just £226 million, allowing for seasonal variations, significantly less than the recent monthly average of £330 million.

The figures suggest that British consumers are becoming more controlled about curbing spending habits.

But HBOS this week announced a decline in bad debt was coupled with a rise in the proportion of bad debt picked up on unsecured lending.

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