1st Sep 2025 09:58
(Alliance News) - UK households and businesses showed mixed borrowing patterns in July, with mortgage demand softening but consumer credit and corporate lending holding firm, data from the Bank of England showed Monday.
Net mortgage borrowing by individuals fell to GBP4.5 billion in July from GBP5.4 billion in June, while mortgage approvals for house purchases edged up slightly to 65,400 from 64,600. Approvals for remortgaging fell to 38,900 from 41,600.
The average interest rate on newly drawn mortgages fell for a fifth consecutive month to 4.28% in July, down from 4.34% in June.
Consumer credit growth remained steady. Net borrowing rose to GBP1.6 billion in July from GBP1.5 billion in June, driven by credit card borrowing of GBP0.8 billion and GBP0.9 billion from other forms such as personal loans. The annual growth rate for all consumer credit rose to 7.0%, from 6.8%.
Households added GBP7.3 billion to their bank deposits in July, slightly down from GBP8.0 billion in June. Most of the increase came from interest-bearing sight accounts and ISAs.
Private non-financial corporations raised GBP300 million of net finance in July, down from GBP1.1 billion in June. This included GBP2.2 billion in bank loans and GBP500 million in bond issuance, offset by GBP2.9 billion in equity buybacks.
Borrowing by large businesses grew at an annual rate of 8.0%, up from 6.7% in June. For SMEs, the growth rate rose to 0.9% from 0.3%, the strongest pace since August 2021.
The net flow of sterling money slowed to GBP7.1 billion in July from GBP11.4 billion in June. Net lending to households and PNFCs totalled GBP7.7 billion, down from GBP19.9 billion.
By Eva Castanedo, Alliance News reporter
Comments and questions to [email protected]
Copyright 2025 Alliance News Ltd. All Rights Reserved.