Credit card borrowing rose at the fastest annual rate for almost two years in November, according to the Bank of England, as households took on debt to finance the rising cost of Christmas.
In a snapshot covering the month of Rachel Reeves’s highly anticipated autumn budget, the central bank said individuals borrowed an additional £2.1bn in consumer credit, up from a £1.7bn increase in October.
Net borrowing through credit cards was £1bn, up from £700m a month earlier. Borrowing using other forms of consumer credit – including car dealership finance and personal loans – rose by £100m to £1.1bn.
Annual growth in credit card borrowing rose from 10.9% in October to 12.1% in November – the highest rate since January 2024.
Experts said the figures could reflect people borrowing more in the critical pre-Christmas shopping period, as households come under mounting pressure from the rising cost of living.
Simon Trevethick, of the StepChange debt charity, said: “For many households, the increase in consumer credit borrowing in November may reflect the reality that everyday costs are becoming harder to manage without turning to credit.
“The increase could also indicate people borrowing more in preparation for the festive period – our own polling found that 14 million people would struggle to afford Christmas.”
While the UK’s annual inflation rate has fallen back to 3.2%, it is still above the official 2% target and prices remain significantly higher than in recent years. Consumers also paid more for festive treats compared with last year, after a sharp rise in food prices.
British consumers had shown reluctance to spend in late 2025 amid intense speculation over tax increases in the chancellor’s budget. Official figures show retail sales volumes unexpectedly fell by 0.1% in November. A study by the accountancy group KPMG also found concerns over the health of the economy were holding consumers back.
Economists said the growth in consumer credit could indicate an early rise in confidence among households to use borrowing to finance their spending. However, households increased their deposits with banks and building societies by an additional £8.1bn in November, up from £6.7bn in October.
Reflecting a pre-budget slowdown in the UK property market, net mortgage approvals for house purchases fell by 500 to 64,500 in November.
Alex Kerr, a UK economist at the consultancy Capital Economics, said the rise in bank deposits could reflect people reorganising their finances in anticipation of tax changes in Reeves’s budget. However, the increase was much smaller than a £20.2bn rise in deposits in October 2024, before the chancellor’s first autumn budget.
“That suggests nervousness about forthcoming tax rises didn’t put consumers off borrowing in November,” Kerr said. “Overall, today’s release adds to the evidence that speculation about tax rises ahead of November’s budget didn’t influence households’ spending decisions too much. This also suggests there isn’t much scope for a pickup in consumer spending in 2026.”
