London, January 6, 2026, 07:36 GMT
British consumer borrowing rose by the most in two years in November, while mortgage approvals for house purchases edged lower, Bank of England data showed on Monday. Consumer borrowing grew by a net 2.08 billion pounds ($2.79 billion) during the month and mortgage approvals fell to 64,530 from 65,010 in October, the data showed. “Speculation about tax rises ahead of November’s Budget didn’t influence households’ spending decisions too much,” said Alex Kerr, UK economist at Capital Economics. 1
The figures matter because they offer a quick read on whether household demand is holding up as tax changes loom and borrowing costs remain elevated. In Britain, consumers drive a large share of economic growth, and swings in credit can show up fast in spending.
They also land as the central bank weighs how much room it has to keep easing policy without reigniting inflation. The Bank of England’s Bank Rate is 3.75% after a December cut, while inflation is 3.2% against a 2% target, its website shows. 2
In its monthly Money and Credit release, the BoE said net borrowing of consumer credit rose to 2.1 billion pounds in November from 1.7 billion in October. Credit card borrowing was 1.0 billion pounds, while other forms of consumer credit such as personal loans and car dealership finance rose to 1.1 billion, and the annual growth rate for credit card borrowing accelerated to 12.1%. The “effective” interest rate — the actual interest paid — on newly drawn mortgages nudged up to 4.20% in November and the rate on interest-charging credit cards rose to 21.60%, the BoE said. 3
The Guardian said debt charity StepChange and other experts viewed the jump in credit as a sign some households were leaning on borrowing to cover rising costs ahead of Christmas. It also noted households increased deposits with banks and building societies even as credit card borrowing accelerated. 4
Consumer credit is unsecured borrowing, mainly credit cards and personal loans, and is often used to smooth day-to-day spending. Mortgage approvals are lender sign-offs for home purchases and tend to foreshadow future mortgage lending by a few months.
The housing picture was mixed. Approvals dipped, but remortgaging activity picked up, the BoE said, suggesting some borrowers were still refinancing as rates move and fixed deals roll off.
The risk is that stronger borrowing reflects strain rather than confidence. If inflation proves sticky and rates fall more slowly than households expect, higher-interest debt can bite quickly and raise the chance of missed payments.
