New data from the Bank of England has triggered a stark warning for UK credit card holders, revealing a sharp increase in borrowing in the run-up to the festive season.
Credit Growth Accelerates to 8.1%
The central bank's latest report shows that the annual growth rate for consumer credit, which includes credit cards and personal loans, climbed to 8.1% in November 2025. This marks a significant rise from the 7.5% recorded in October and represents the fastest pace of growth in nearly two years.
This spike is particularly concerning as it occurred during the crucial pre-Christmas spending period. Experts suggest it points to a growing reliance on credit to manage escalating living costs and festive expenses.
Charity Warns of Mounting Debt Pressures
Simon Trevethick, Head of Communications at the StepChange Debt Charity, responded to the figures with a clear caution. He stated that for many households, the increase likely reflects the harsh reality that everyday costs are becoming unmanageable without turning to credit.
"The increase could also indicate people borrowing more in preparation for the festive period," Trevethick added. "Our own polling found that 14 million people would struggle to afford Christmas."
He issued a critical warning: "While some people will be able to repay any additional borrowing, others risk carrying balances into the new year and beyond." Trevethick strongly emphasised that free and impartial debt advice is available and that no one should feel they have to cope with problem debt alone.
Property Market Shows Resilience Amid Economic Noise
The Bank of England's report also contained insights into the housing market. While the focus was on consumer credit, commentary from property experts provided context on broader economic sentiment.
Jason Tebb, President of OnTheMarket, noted that mortgage approvals decreased only slightly in November, highlighting the "overall resilience and determination" of buyers and sellers.
Simon Gammon, Managing Partner at Knight Frank Finance, observed that the political noise ahead of the budget likely caused many buyers to pause plans until after Christmas. However, he pointed to easing mortgage rates in December and suggested that pent-up demand could be released as spring approaches.
"The lenders begin the year with fresh targets," Gammon said, "and we expect the larger lenders to be most aggressive in cutting rates in the first weeks of January."
Nathan Emerson, Chief Executive of Propertymark, struck an optimistic note for 2026. He cited the Bank of England base rate cut introduced before Christmas as a likely confidence booster, making borrowing more affordable and encouraging more buyers to proceed.
The juxtaposition of rising consumer credit and a cautiously optimistic property outlook paints a complex picture of the UK's financial health as it moves into the new year, with household debt remaining a key area of concern.
