FCA INSIGHT ARTICLE: Who is driving consumer credit growth?

The FCA has published an Insight article that considers who is driving consumer credit growth.

Although regulators have relied upon aggregate data from larger lenders to monitor which lenders are driving credit growth, there are important gaps. For example, they do not include less-mainstream products that people with low incomes often rely on; and do not show who is borrowing, or people’s overall debts across different lenders and products.

In order to build a better picture of borrowing, the FCA requested data from credit reference agencies for one in ten UK consumers. The data relates to consumer credit, mortgages and utilities. The FCA examined this data to assess possible risks from recent credit growth. This article summarises three particular insights which have emerged including:

• credit growth has not been driven by subprime borrowers;
• people without mortgages have mainly driven credit growth; and
• consumers remain indebted for longer than product-level data implies.