CONSUMER credit is on the rise for the first time since the downturn as confidence returns amid the economic recovery, according to new figures.
A report from the EY ITEM Club suggests the popularity of buying now and paying later is improving after a four-year slump. However, net lending to businesses is expected to have fallen this year, adding weight to fears that the recovery is too heavily balanced towards household spending. Consumer credit has fallen by 23 per cent, or nearly £50 billion, since 2008 but will notch up a small increase this year, the report said.
Carl Astorri, senior economic adviser to the EY ITEM Club financial services forecast, said: "Net consumer lending is only set to grow by 1.5 per cent this year but it is very encouraging that it has now finally returned to growth." Mr Astorri said the key driver of growth had been consumer demand.