16th November 2015
Almost 70% of Britons will be able to deck the halls this Christmas without having to take on any extra borrowing, according to the latest quarterly Lloyds Bank Lending Report,
The study also highlighted that consumers are continuing to feel confident that they will be able to keep up with monthly loan repayments.
Sentiment towards paying off credit remains high, with over four in five, at 84%, of those surveyed feeling confident or very confident that they will meet their future repayments.
The most common source used to make these payments is household income, with usage of this method increasing significantly from 82% in the second quarter this year to 85% in the three months to end of September.
Digital channels are the preferred route for taking out a personal loan.
The proportion of people who apply for a loan online is significantly higher than those who do it in branch, with 52% using an online format to apply for a loan compared to 30% who apply in branch and 10% over the telephone.
The top reason people, as cited by 30% of respondents, have taken out a personal loan is debt consolidation while 28% said it was for purchasing a car or motorbike.
Of those who used lending to fund a special occasion, nearly half, at 47%, took out a loan to fund someone else’s birthday and 15% took out a loan to fund their own birthday.
Sam Clark, head of loans at Lloyds Bank, said: “We are continuing to see encouraging signs as more people can better manage their borrowing repayments.
“With an increase in consumers using household income to pay off existing credit, allied to the significant percentage of people saying they will not need to borrow more in the next six months, this paints a positive picture for consumer finances as we look ahead to the Christmas period.”