Connect with us

Hi, what are you looking for?

Editor’s Pick

Demand for debt services by Lloyds customers jumps 30%

Demand for debt services among Lloyds Bank customers has jumped by 30% in the first six months of the year, as the cost of living crisis takes its toll.

Amid a squeeze on living standards, research from the bank indicates three-quarters of its 26 million UK customers were worrying about rising prices and the impact it is having on their savings.

The chief executive of Lloyds, Charlie Nunn, said that customers were working to get a grip on their finances by consolidating their debts.

Nunn added that eight in 10 of its customers have less than £500 of savings in their current and savings accounts.

Lloyds Banking Group is the country’s largest mortgage lender and is often considered a bellwether for the UK economy.

According to its research, 20% of its customers are already cutting back on their discretionary spending to make sure they can cover the cost of essential items.

“Customers are concerned, and they should be,” Nunn told the BBC. “We have seen some areas where there’s real points of challenge.

“About 80% of individuals and UK customers and families have less than £500 worth of savings in their current account and their savings account. They might have money elsewhere but what we can see is less than £500.”

Despite the sharp increase in customers dealing with problem debts, Nunn said that only 1% were unable to pay their usual bills.

Inflation in the UK soared to a 40-year high of 9.1% in May, and is predicted to rise as high as 11% later this year, amid soaring costs of energy, food and raw materials.

The lender reported in the spring that its customers were already beginning to tighten their belts, with more than 1 million cancelling their gym memberships and video streaming contracts.

Lloyds said last month it would give more than 64,000 of its staff a £1,000 bonus to help them with the cost of living.

Nunn, who took over as chief executive at the banking group in August 2021, said Lloyds customers were concerned about the economy, but cautioned there was a danger that the UK could be talking itself into a recession.

“We are concerned that I think we collectively are talking ourselves into the risk of too negative an outlook,” Nunn said.

“There are pockets of strength in the economy. There are significant parts of the consumers in the UK who have strength and really want to spend and create that demand and we can continue to see opportunities to invest in growth.”

Travel is one of the spending bright spots, the group said, reporting that credit card spending on holidays was up 300%.

Your information is secure and your privacy is protected. By opting in you agree to receive emails from us. Remember that you can opt-out any time, we hate spam too!

You May Also Like

News

BW FILE PHOTO GROSS BORROWINGS by the National Government reached P2.6 trillion as of end-September as it continued to raise funds to respond to...

News

REUTERS By Luz Wendy T. Noble, Reporter The country’s foreign exchange buffers slightly increased as of end-October as the value of the central bank’s...

News

COVID-19 has had a significant impact on the mental health of Filipinos across different groups all over the archipelago. From frontline workers, parents balancing...

Financial Advisors

The healthcare ecosystem is one that has thrived on the cusp of scientific progress, benefitting enormously from the winds of change in the technological...

Disclaimer: Respect Investment.com, its managers, its employees, and assigns (collectively "The Company") do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

Copyright © 2022 Respect Investment. All Rights Reserved.