Banks write off record credit card debt

A record amount of credit card debt has been written off by banks.

Bank of England statistics show that the amount of money being written off by credit card lenders hit a high in the second quarter of 2010.

The value of write-offs hit £2.1billion in April, May and June – a significant increase from the £1.3billion in the first quarter of 2010.

Debt is written off by lenders if they conclude borrowers cannot repay.

A record £4.1billion was written off by credit card lenders last year. That amounts to around 10% of all money lent on credit cards.

It looks likely that figure will be exceeded this year.