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28 March 2006
Consumers are starting to pay off their credit card debts, says financial advice company Moneyextra.com.
For the first time in 19 months, average credit card balances are under £3,000, says the company, and have been falling for ten months.
The average outstanding balance transfer in February, at £2,521, was the lowest since records began at Moneyextra.com in 2003.
"It's clear that what we're seeing is a two-tier credit card market," commented Moneyextra.com's Robin Amlot.
"Card deals are less attractive than they were this time last year. Many people are finding their zero per cent borrowing deals coming to an end and they're opting to pay off debt."
Outstanding card balances have been falling since April 2005 and are 28.5 per cent lower than that month's peak of £3,527, says the company.
Bank of England figures showed that the increase in total net lending to individuals in January 2006 was £10.5 billion, which was £0.7 billion higher than December's increase. Credit card lending also increased by £0.7 billion in January.
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