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Thursday, 28 November, 2002, 00:00 GMT
Christmas debt bonanza
A UK high street full of shoppers
High Street card spending set to grow by 14.2 %.
Britons are expected to massively increase their spending on credit and debit cards in the run up to Christmas.

On average, £7,600 per second will be spent on credit and debit cards during Christmas, according to the Credit Card Research Group (CCRG).

It is difficult to resist the conclusion that the recent growth in consumer borrowing will lead to problems for a record number of people.

David Harker National Association Citizens Advice Bureaux (NACAB)

Retailers are again set to be the big winners this Christmas, with high street card spending set to grow by 14.2 % year-on-year.

But debt charities are warning that consumers are storing up a credit hangover for the New Year.

Economic uncertainty

Spending on plastic in the UK is expected to exceed £20bn in December.

Credit and debit card expenditure consistently account for more than half of all spending on the High Street.

"Despite some uncertainty for the UK economy, it seems clear that consumers are determined to enjoy themselves this Christmas," said CCRG director Steve Round.

The CCRG estimate of December credit and debit card spending follows a DTI study which concluded that most Britons were 'sensible' about debt and not falling behind with repayments.

Nevertheless, the prospect of UK shoppers stretching their credit limits over Christmas has alarmed debt charities.

Record number

Consumer debt problems handled by National Association Citizens Advice Bureaux (NACAB) have increased by 46% over the last five years.

In the last year NACAB advisers have taken on more than a million new debt cases.

NACAB director David Harker told BBC News Online:

"It is difficult to resist the conclusion that the recent growth in consumer borrowing will lead to problems for a record number of people - who will face far larger debt problems than ever before."

Your Comments

Why do we HAVE to spend more than we can afford? Don't be suckered into debt by the marketing! Forget drink driving, this years Government ad campaign should be THINK! Don't BORROW!
M Baker, England

I am perplexed? With credit card debt at an all time high and mortgage repayments the highest ever, how does the chancellor come up with such low inflation figures. Jay
John Phillips, Brit Expat in Canada

For the first time I am going to give all my family members home-baked goodies. If I can rustle up some really nice things, then that will go down better than any amount of money spent.
Simon D, England

I feel sorry for the people who will get into a debt trap this Christmas and suffer for years to come. I have learned my lesson and no longer look at my credit cards as 'my' cash but rather a debt collector waiting for an excuse to harass me. I only use my cards when I have budgeted properly for them or an emergency.
Andrew Robertson, UK

I am not worried personally because of the controls I put on my spending. A debit card is only spending money that you have in the bank anyway and with current levels of street crime is safer and more convenient than carrying lots of cash. As such it is not strictly true to classify it as debt spending. On credit cards I never spend more than I have in the bank to pay it off. It is all very simple as long as you budget according to your means and, coming from a working class background, I am very conscious of the issues around living beyond your means.
Peter, UK

No I am not worried about what Christmas will cost, this is because I belong to what seem to be a rapidly shrinking pool of people who don't spend more than they can afford! People seem to forget the simple maxim "Can't pay for it - Don't buy it" it's really that simple.
A Smith, Wales

Every year it gets worst, you spend more, people want more and more expensive things and before I know it I've spent a fortune and that does not include food and drink for the festive season. Why do we do it to ourselves? some say "it is the season to be jolly" but for how long? I end up spending too much and getting stressed and usually end up broke and can't even afford to treat myself in the January sales. Where is the joy in that?
Inger Halliman, London/England

Why is it that people feel the need to exceed their spending capabilities in a seasonal fashion, Christmas has become a financial goldmine for debt/credit companies. If you want to express yourself by buying a gift for someone, why wait until Christmas? It seems to me that the majority of people feel 'pressured' to buy more and more expensive gifts at this time of year, when in reality a large proportion of purchases are made by people who do not follow any faith, all amounting to giving the retailers a license to print money. I don't have a downer on Christmas, or religion, I just think that people should stop and think more often about why it is they feel more pressured into spending money they don't have for this time of year, than the other 364 days.
Mat, UK

I'll be spending money in the bank this Christmas, or at the very worst, clearing my credit card balance as soon as the statement arrives. Bah, humbug?? Not really, it's just that I know my kids prefer to have a relaxed dad to play with rather than a debt-ridden nervous wreck.
Dave, UK

Not at all, two words spring to mind "Fiscal Responsibility". If you spend what you don¿t have you deserve to have problems.
Fraser Heath, Aberdeen, UK

It's sad that a festival celebrating the birth of a humble man from a poor family has been twisted into a spending spree laden with guilt that leaves many families with debt and other problems. As usual, it's the poor the suffer the most.
Tim , UK

My partner has already spent in excess of £2,000 on her children, and she has no job to pay it back. I think it's irresponsible of the credit providers to provide credit to anyone who asks, without doing proper checks on people. She has walked into shops in the past and obtained a scorecard, and spent the full limit in the first visit - she then gets into arrears on the payments. Is it any wonder NACAB has so many new cases! The credit Companies need to understand their role in this too.
Ian, UK

I am going to spend hardly anything this xmas. My kids get loads of presents from relatives and I have already told them that they will be getting money to spend in the sales. I am fed up with buying expensive toys (that they do not play with because they get so many presents) only to see the same thing at half the price in the sales!!!!
Paul, UK

Christmas, like any other event needs financial restraint and planning. Christmas is for spending time with friends and family and we should not fall prey to the heavy advertising and the competitive 'keeping up with the Jones'' when it comes to spending on presents. With the ease and availability to get credit today, I fear many will find themselves in trouble come January and beyond.
Christian, UK

See also:

20 Nov 02 | Business
12 Nov 02 | England
24 Dec 01 | Scotland
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