Less British consumers have credit card debts

The research published by Auriemma Consulting Group indicates that British consumers are less likely to have credit card debt than they were before the credit crunch. By the end of 2008 the number of consumers, which were likely to be burdened by credit card debt, decreased by 21% as compared with this number in the beginning of the year. In the first quarter of 2008, as the research indicated, 63% of UK consumers carried balances on their credit cards. In the end of 2008 50% of credit cards’ debts were revolved.

The research was published in Cardbeat. Megan Bramlette, the Managing Editor of Cardbeat, says, “Consumers proactively reducing their debt levels is encouraging, especially given the uncertainty of the economy and that many consumers are currently struggling to repay their debts.” As she added further there are also many other consumers, which are in worse shape than before, because of increased debt as a result of increase in interest rates.

As it was indicated in the research income was the primary indicator of consumers’ ability to repay the debt on credit cards. The average debt held by consumers with household income lower than £30,000 increased 23% in the course of year 2008 from £1,111 to £1,366, however, the average debt burden of consumers with household income greater than £30,000 decreased 18%, from £2,448 to £2,006, due to their focusing on paying down their debts.