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Consumer borrowing soared in last months of 2015, Bank of England figures show

The run-up to Christmas saw the largest rise in consumer borrowing in nearly eight years, according to figures from the Bank of England.

In November 2015 consumers owed a total of £178.2 billion on credit cards and loans, up £1.5 billion on the previous month - the largest rise since February 2008. October had also seen a rise of £1.2 billion.

The figures suggested good news for retailers, as a rise in consumer credit generally indicates increased spending on the high street.

Office for National Statistics (ONS) figures show that retail sales volumes rose by 5% in November compared with the same month in 2014, helping to provide a boost for UK economic growth.

However, some commenters have expressed concerns about the increase in personal debt levels.

Howard Archer, chief UK economist at IHS Global Insight, stated: ‘The pick-up in unsecured consumer credit to a near eight-year high in November follows on from data from the ONS showing that the household savings ratio dipped to 4.4% in the third quarter of 2015, which was the equal lowest rate since 1963.

‘This will fuel concern that consumers are borrowing more and saving less to finance their spending, which is likely a consequence of relatively high consumer confidence and extended low interest rates.’

The Bank of England figures mean that the average person in the UK now has borrowings of £2,759, not including mortgage debts.