Credit card usage is the highest it’s been for 17 years

It’s no surprise that with the cost of goods and services increasing as they have over the last few months, many of us are turning to credit cards to cover the cost.

It was reported in The Guardian the amount lumped onto credit cards was the highest it’s been in 17 years, rising by £740 million month-on-month. 13% higher than the year before. Figures released by the Bank of England show this to be the biggest year-on-year rise since October 2005.

Spikes in inflation (to 10.1% in July), looming energy price increases and the higher cost of household goods are some of the reasons that could explain the increase in credit card usage.

Looking at wider consumer credit, including unsecured personal loans and overdrafts, we’ve had our fastest rate of increase since March 2019, up 6.9% to £1.42 billion.

The chief executive of Money Advice Trust, said, “Today’s figures are a further sign of the relentless pressure that household finances are under.

“Confirmation on Friday of the huge hike in energy prices will have only added to the worries of millions of people concerned about how they will make ends meet in the coming months. For many households, however, options are already running out, with more turning to credit to cover essential needs. And for those who are already in difficulty, the situation is only set to get worse without intervention.”

With increases everywhere you look, it’s hard not to feel helpless. Luckily, there are some small changes you can make to ease the pressure.

Credit cards are often bad news, so unless you really know what you’re doing it's best just to stay clear. As well as high interest rates your bank might add other extra charges, such as fees for going over your credit limit. This can be bad news if your credit score’s not already at its best.

One solution that’s available at the moment is Buy Now Pay Later. Often associated with clothing, this popular payment option has no interest and rarely involves a lengthy application form for approval, hence its recent meteoric rise.

Whilst Buy Now Pay Later is mostly associated with online fashion retailers, there are a growing number of companies offering this as a solution for large unexpected costs. Bumper is one such company; taking the stress out of pesky car repair costs.

With Bumper, payments can be broken down into 1-9 monthly instalments*, completely interest-free. Applications are completed online in just a few clicks and a soft credit check means your application won’t affect your credit score.

You’ll be given a maximum credit limit and a unique Bumper Code. Make a booking with one of the partner garages found on our map, and when you get there, let them know how you want to pay. Give them your code and they’ll sort the rest!

Make any unexpected repair costs fit into your monthly budget. To start your application, enter your vehicle registration and postcode on our website.

*The number of repayments, the amount of credit and the need for a deposit changes depending on the partner you choose, but it will always be interest-free!