Credit card write-offs on the rise

Banks and high-street lenders wrote off a record amount of credit card debt in the second quarter of 2010, it has been suggested.

New figures published by the Bank of England have revealed that the value of write-offs in April, May and June reached £2.1bn, representing a £0.8bn rise from the previous quarter.

In addition, the central bank’s study showed that £1.2bn was written off in overdrafts, personal loans and hire purchase agreements.

Mark Sands, director of personal insolvency at accountants RSM Tenon, explained that the impact of the recent recession is now beginning to be felt by some Britons.

"It is not necessarily that people have lost their job, but they have lost their overtime, an extra shift or have had a pay cut," he said in an interview with the Daily Mail.

Meanwhile, the British Bankers’ Association claimed recently that credit card repayments by UK consumers totalled £6.2bn in July, compared to £5.9bn in new spending.

Source: Compareandsave.com