Why UK Consumer Borrowing Is Rising – And How to Avoid Expensive Debt in 2026

Recent figures from the Bank of England show that UK consumer borrowing is rising at its fastest pace in over a year, with credit card borrowing in particular accelerating sharply. This trend matters, not just for policymakers and lenders, but for households trying to manage everyday finances in a higher-cost environment.

Understanding why borrowing is increasing – and how to avoid relying on high-interest credit – is an important part of maintaining long-term financial resilience.

UK consumer borrowing: what the latest data shows

According to the latest Bank of England data, UK consumer borrowing rose by just over £2 billion in November, the largest monthly increase since late 2023 . A significant proportion of this increase came from credit card borrowing, which continues to grow faster than other forms of consumer credit.

Annual growth in credit card borrowing has now reached its highest level in almost two years, reflecting greater reliance on revolving credit to cover short-term spending . Reuters analysis of the same data confirms that consumer credit growth has outpaced recent trends, even as mortgage activity remains subdued .

In simple terms, more people are borrowing more on credit cards, and carrying those balances for longer.

Why credit cards can become expensive very quickly

Credit cards are designed for convenience and short-term flexibility. Used carefully, they can be a useful tool. However, when balances are not cleared quickly, interest costs can accumulate rapidly.

Average credit card interest rates remain high by historical standards, meaning that even modest balances can take years to repay if only minimum payments are made. Over time, a significant proportion of repayments can go towards interest rather than reducing the original debt.

This is one reason why a sustained rise in credit card borrowing is a warning sign. It often indicates that borrowing is being used to bridge ongoing spending gaps rather than to manage short-term timing issues.

Why borrowing is rising now

There is no single explanation for the current increase in consumer borrowing, but several factors are likely contributing:

• Everyday cost pressures, including food, energy, and household bills

• Seasonal spending, particularly in the final months of the year

• Tighter household budgets, leading some people to rely on credit to smooth cashflow

Debt advice organisations have noted that more households are turning to credit to manage routine expenses rather than discretionary purchases . While this may provide temporary relief, it can store up problems if high-interest debt becomes persistent.

How to avoid high-interest borrowing

Rising consumer borrowing does not mean debt is inevitable. There are practical steps individuals and households can take to reduce reliance on expensive credit.

1. Understand the true cost of borrowing

Before using credit, look beyond the monthly payment and understand the interest rate and total cost over time. A balance that feels manageable today can become expensive if it remains unpaid for months or years.

2. Build a realistic household budget

A clear view of income and essential spending makes it easier to identify pressure points early. Even small adjustments can reduce the need to rely on credit cards to cover shortfalls.

3. Use savings strategically where possible

For those with savings, using a portion of an emergency buffer can sometimes be cheaper than carrying high-interest debt. The aim is to avoid paying long-term interest on short-term problems.

4. Review borrowing regularly

Credit that was appropriate at one point may no longer be the best option. Periodic reviews can help identify opportunities to reduce costs, consolidate borrowing, or accelerate repayment.

5. Talk to your lender early

If repayments start to feel stretched, early conversations matter. Lenders are often better able to help when issues are addressed before arrears develop.

A sustainable approach to borrowing

At Wessex Bank, we believe that sustainable borrowing is about balance – matching credit to genuine need, affordability, and long-term financial stability. Strong financial institutions are built on prudent lending and informed borrowers, not on the growth of high-cost debt.

Rising consumer borrowing figures are a reminder that credit should be a tool, not a crutch. By understanding the costs involved and taking early, practical steps, households can avoid expensive debt and retain greater control over their finances.

Where to find independent support

Anyone concerned about managing debt can access free, independent guidance from organisations such as:

• Citizens Advice

• StepChange Debt Charity

• National Debtline

Seeking advice early can prevent small issues from becoming long-term problems.