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Are UK Cardholders Clinging to the Life Raft?

Over the past few quarters, I’ve commented on the generally positive card management trends shown by UK cardholders. It appeared that people were making more timely payments in order to protect that old reliable life raft of economic storms — the credit card.

Our latest UK cards data, released yesterday, shows that more people may be clinging to the life raft. Average total sales per “classic” credit card hit a two-year high in December of £600.25, 10% higher than the spend in December 2011. Not only that, but the growth in spending on cards was about five times higher than the government’s figure for YoY growth in retail sales in December, 1.8%.

UK Card Data Dec 2012 Chart 2

As my colleague Nigel Brayne pointed out, this suggests that more people this year didn’t have the money in their current accounts to cover the Christmas goodies. So they decided to buy now and pay later. Whether they’ll be able to pay later will be on every account manager’s mind.

The other number to watch in our latest report is that new accounts showed a drop of 22% in the percentage of payments to balance, compared with December 2011.

Spend more, pay less. UK cardholders are going to be keeping card issuers and portfolio managers on their toes.

If you’re a UK card issuer and want to really dig into these kinds of results, the best way is to join the FICO® Benchmark Reporting Service, which compares overall market performance in the UK cards market with individual card issuers’ performance. For information, contact Stacey West at

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