Banks tighten up on non-mortgage lending

Banks and building societies are tightening up on nonmortgage lending to households and snipping the length of interest-free periods, according to a Bank of England survey.

The length of interest-free periods for balance transfers on new credit card lending was reported by lenders to have decreased slightly over the past three months – the first fall since this question was first asked at the start of 2015. But the length of interestfree periods for purchases on new credit card lending was reported to have increased slightly in the third quarter.

The proportion of nonmortgage credit applications being approved has fallen significantly in recent months, the credit conditions report found.

Lenders said the availability of non-mortgage credit to households decreased in the third quarter of this year and was expected to see a “significant” decrease in the next three months.