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Lack of credit 'has changed spending habits'

Lack of credit 'has changed spending habits'

Category: Loans

Updated: 05/01/2009
First Published: 31/12/2008

MONEYFACTS ARCHIVE
This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

Consumers have become more prudent in their spending as they become more aware of the economic downturn, it has been observed.

While in the past many credit card customers have faced large bills in January, this is not likely to be the case this year, Moneyfacts.co.uk has noted.

Spokesman Darren Cook explained that changes in interest rates on secured and unsecured loans as well as a tightening of credit have made Britons more aware of finances.

"A lot of people go too far on credit if it is available but there is less credit available so there is going to be less shock than normal," he added.

Mr Cook explained that this represents a change from the traditional tactic of spending on credit and then consolidating with unsecured loans.

In related news, Fool.co.uk has warned that credit limits may be reduced by banks and credit card providers in January, with head of personal finance David Kuo warning customers that they need to be careful in order to avoid charges.

Disclaimer: Information is correct as of the date of publication (shown at the top of this article). Any products featured may be withdrawn by their provider or changed at any time.

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