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Banks and building societies predict an increase in credit card defaults through November as people struggle with essential bills alongside rising interest rates and inflation. The Bank of England's Credit Conditions Survey indicates that while mortgage default rates slightly decreased and are expected to remain stable, unsecured credit card defaults are on the rise. Financial experts warn that higher energy costs and inflation could exacerbate financial pressure on households in the coming months.
Written locally by qwen2.5:14b on 2026-10-08,
using this article's own text rather than the other coverage of the
same event (that is the story summary below).
Story summary
The Bank of England’s latest Credit Conditions Survey indicates lenders expect default rates on credit cards to rise in the three months ending November. While mortgage defaults slightly decreased and are expected to remain stable, unsecured credit card defaults are projected to increase due to financial strain caused by rising energy prices and interest rates. Debt help charity StepChange reports a 20% higher client support demand than anticipated this year, citing difficulties with essential bill payments alongside loan repayments. Nathan Emerson from Propertymark sees growing confidence in the housing market but acknowledges potential challenges ahead. Karim Haji from KPMG notes that while some households rely more on credit, they face increasing financial hardships.
Written for “Credit Card Defaults Increasingpredic…” on 2026-10-08,
grounded in this article and the 1 other(s) covering the same event.
Why this leaning score
The model judged this article politically coded and scored it -0.35, but all 2 of its quote(s) are attributed speech - words the article quotes from someone, not the article's own narration, so the score is not published.
Written under an earlier scoring contract, which gave a paragraph
rather than checkable quotes. Re-analysing this article replaces it.
Leaning score withheld for article 65481: attributed speech only · logged 2026-10-08
Defaults on credit cards are also expected by banks and building societies to increase in the three months to the end of November.
asserted
Defaults → expect → November
Lenders also said default rates on mortgages slightly decreased in the three months to August and are expected to be unchanged in the three months ahead.
asserted
rates → say → months
Meanwhile, default rates on loans to companies were unchanged in the three months to August and they are predicted by lenders to remain unchanged in the upcoming quarter.
asserted
they → predict → quarter
Adam Butler, public policy manager at debt help charity StepChange, said: “Defaults on unsecured credit are rising as people struggle to make their regular repayments alongside essential bills.
asserted
people → say → bills
“With further price shocks to come in the winter with energy price rises, interest rates trending upwards, and wider consumer prices continuing to rise above the Bank (of England)’s target, we expect this to feed through into our advice service with continuing increased demand for support, with the charity already supporting 20% more clients than expected this year.”
asserted
charity → come → clients
Karim Haji, global and UK head of financial services at KPMG, said the figures “suggest that some households are continuing to lean on credit while simultaneously finding it harder to manage existing debts”.
asserted
it → say → debts
He said: “That divergence is an important indicator of where financial pressure is most acute.
“
asserted
pressure → say → ?
A dip in mortgage defaults offers some reassurance that most borrowers are continuing to absorb higher housing costs, but rising unsecured defaults underline the financial strain still facing more vulnerable households.
asserted
defaults → offer → households
“Looking ahead, (the fourth quarter of the year) could bring renewed financial pressure on households, with higher energy bills and inflation coinciding with the seasonal increase in spending in the run-up to Christmas.
uncertain
bills → look → Christmas
Read More
“Higher borrowing costs will also add another headwind for consumers.
asserted
costs → read → consumers
Lenders need to be thinking now about how these pressures could affect households later in the year.”
uncertain
pressures → need → year
The Bank of England carries out the Credit Conditions Survey each quarter as part of its role to maintain financial stability.
asserted
Bank → carry → stability
The latest survey was carried out between August 17 and September 4 and so any impact from more recent developments will not be captured.
asserted
impact → carry → developments
Lenders were asked to report changes in the three months to the end of August relative to the previous quarter year between March and May.
uncertain
Lenders → ask → March
They were also asked about their expectations for the three months to the end of November.
asserted
They → ask → November
Lenders reported mortgage availability decreased in the three months to the end of August and it is expected to increase slightly over the three months to the end of November.
asserted
it → report → November
Demand for mortgages for house purchase decreased in the three months to August, and is expected to increase slightly in the three months ahead.
asserted
Demand → decrease → months
Remortgaging demand fell in the three months to August but it is also expected to increase in the period to the end of November.
asserted
it → fall → November
Nathan Emerson, chief executive at property professionals’ body Propertymark, said: “It is encouraging to see growing confidence around the potential demand for secured lending for house purchases and remortgaging in the months ahead.
asserted
It → say → months
“While the year has proved challenging for many consumers from an affordability perspective, improved access to finance could provide an important catalyst for greater confidence across the housing sector as we approach the end of the year and head into 2027.
uncertain
we → prove → 2027
“Maintaining access to affordable lending will be important in helping the market build momentum and providing greater certainty for consumers.”
asserted
market → maintain → consumers
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