Rates on consumer credit products either remained steady or registered small declines in May, according to Freedom Finance’s analysis on the latest Bank of England data.

The digital lending marketplace found that despite market volatility leading to disruption in the mortgage market with widespread product withdrawals and notable increases to rates on fixed-term deals, the average quoted household interest rates remained almost the same.

Personal loan rates of £5,000 remained at 10.33% in May, having risen from 10.16% in January. £10,000 personal loan rates decreased to 5.86% from 5.9% in April and 5.91% in January.

Furthermore, credit cards remained at 22.7% last month, representing a slight increase in 22.4% from the start of the year, with overdrafts remaining at 35.25% in May; a slight increase from 35.24% in January.

Chief growth officer at Freedom Finance, Andrew Fisher, commented: “The markets have been relatively becalmed through the first half of the year until May when an upside surprise to core inflation data set in motion further turbulence including marked volatility in the residential mortgage sector.

“The consumer credit market remained steady through May, however, with personal loans and credit cards either staying at April’s levels or even becoming slightly cheaper, on average.

“Turbulence in the market is always a good reminder for consumers to return to solid best practice when hunting for credit products. This includes shopping around, ideally using digital marketplaces which not only compare multiple providers via a single search but also use soft-search technology to only show products that borrowers are eligible for.”

Share Story: