Households across the United Kingdom are turning to credit cards at an alarming rate to cover essential bills, triggering a fresh warning from financial experts and debt charities.
Sharp Rise in Borrowing Revealed in Official Data
The Bank of England's latest Money and Credit report, published in early January 2026, paints a stark picture of mounting financial pressure. The data shows that net credit card borrowing surged to £1 billion in November 2025, a significant jump from £700 million in October.
Over the course of the year, the situation has deteriorated markedly. The total stock of outstanding credit card debt grew by 12.1% in the year to November. This represents the most rapid annual increase seen since January 2024, indicating a worrying acceleration in reliance on this form of high-cost credit.
Everyday Costs Force Families to Use Credit
Economists link this trend directly to the sustained pressure on household budgets. Although inflation has eased to 3.2% as of December 2025, the prices of fundamental necessities like food and energy remain far above their pre-pandemic levels.
Simon Trevethick, Head of Communications at the StepChange debt charity, stated that the figures reflect a grim reality for many. "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," he explained.
The broader measure of consumer credit, which includes other loans alongside credit cards, also rose sharply. Net borrowing reached £2.1 billion in November, underscoring the widespread nature of the financial strain.
Risks of a Debt Spiral and a Cooling Housing Market
Charities have issued a stark alert about the potential consequences. "Credit card debt is one of the most expensive ways to borrow. If people fall behind, it can spiral quickly," warned Mr Trevethick. The concern is that families already struggling with elevated bills could find themselves trapped by escalating interest payments.
Meanwhile, the Bank's report highlighted a shift in the housing market. While net mortgage lending increased to £4.5 billion, the number of mortgage approvals for house purchases actually fell slightly to 64,500. This suggests a cooling of demand in some parts of the UK property sector.
The Bank of England has signalled it will monitor household finances closely, with the rising tide of consumer borrowing expected to be a key factor in its future assessments of the country's economic stability.
