These monthly statistics on the amount of, and interest rates on, borrowing and deposits by households and businesses are used by the Bank’s policy committees to understand economic trends and developments in the banking system.
- Net borrowing of mortgage debt by individuals amounted to £1.6 billion in October, the lowest since July 2021. Mortgage approvals for house purchase fell further to 67,200 in October from 71,900 in September, close to the 12-month average up to February 2020 of 66,700.
- Consumers borrowed an additional £0.7 billion in consumer credit, on net. The effective rate on new personal loans increased to 6.27% in October, and is the highest since March 2020 but remains below the January 2020 level.
- Households’ net flow into deposit accounts fell in October to £5.5 billion. The effective interest rate paid on individuals’ new time deposits with banks and building societies rose to 0.36% in October.
- Large businesses borrowed £2.0 billion in loans from banks in October, whilst small and medium sized businesses repaid £1.6 billion. Private non-financial companies (PNFCs) raised £0.3 billion in net finance from capital markets in October, compared to an average net issuance of £0.7 billion in the twelve months to September 2021.
References in the text point to the summary tables below. For further statistics, please see our visual summaries, Effective Rates (ER) statistical release, Capital Issuance statistical release and Bankstats tables.
Lending to individuals
Mortgage lending (M&C Tables D and E):
Net borrowing of mortgage debt by individuals amounted to £1.6 billion in October, down from £9.3 billion in September. This is the lowest since July 2021 when individuals repaid £2.2 billion of mortgage debt, on net (Chart 1). October’s decrease was driven by borrowing brought forward to September to take advantage of stamp duty land tax relief, before it was completely tapered off. The net borrowing in October was £4.6 billion below the 12-month average to June 2021, when the full stamp duty holiday was in effect. Gross lending fell sharply to £19.3 billion in October, from £30.7 billion in September. Gross repayments fell to £18.2 billion from £20.6 billion in September.
Approvals for house purchases, an indicator of future borrowing, fell to 67,200 in October, from 71,900 in September. This is the lowest since June 2020, and is close to the 12-month average up to February 2020 of 66,700. Approvals for remortgaging (which only capture remortgaging with a different lender) rose slightly to 41,600 in October. This remains low compared to the 12-month average up to February 2020 of 49,100, but is the highest since March 2020 (42,700).
Chart 1: Mortgage lending
Seasonally adjusted flows
The ‘effective’ interest rate – the actual interest rate paid – on newly drawn mortgages fell 19 basis point to 1.59% in October, which is a new series low. The rate on the outstanding stock of mortgages ticked down 1 basis point to a new series low of 2.03%.
Consumer credit (M&C Tables B and C):
Individuals borrowed £0.7 billion in consumer credit in October, on net. The majority of this was £0.6 billion of additional borrowing on credit cards, which is the strongest net borrowing since July 2020 (Chart 2). Individual borrowing in other forms of consumer credit (such as car dealership finance and personal loans) accounted for the other £0.1 billion of net lending.
The annual growth rate for all consumer credit remained weak, but increased to -1.0% in October from -1.7% in September. The annual growth rates of credit cards and other forms of consumer credit were -3.2% and -0.5% respectively.
Chart 2: Consumer credit
The effective interest rate on interest-charging overdrafts in October fell back by 7 basis points to 20.67%. This series has ranged between 19.8% and 20.8% since October 2020. Rates on new personal loans to individuals increased by 25 basis points, to 6.27% in October, the highest since March 2020 (6.43%) but remains 76 basis points below the January 2020 level. The cost of credit card borrowing was 17.94% in October, having ranged between 17.5% and 18.5% since March 2020.
Households’ deposits (M&C Table J):
Households deposited an additional £5.5 billion with banks and building societies in October. In addition, households deposited £0.9 billion into National Savings and Investment (NS&I) accounts in October, which are not captured within household deposits but can act as a substitute for them. The combined net flow into both deposits and NS&I accounts in October (£6.4 billion) compares to an average net flow of £11.9 billion in the twelve months to September 2021 (Chart 3). The combined October net flow was slightly higher than pre-pandemic flows: in the year to February 2020, the average net flow was £5.5 billion.
Chart 3: Households’ deposits
Seasonally adjusted net flow
The effective interest rate paid on individuals’ new time deposits with banks and building societies rose 5 basis points to 0.36% in October, the highest since April 2021 (0.46%). The effective interest rate on the outstanding stock of time deposits ticked down a single basis point to a new series low of 0.34%. The effective rates on stock sight deposits remained at a series low of 0.09%.
Lending to and deposits from businesses
Businesses’ borrowing from banks (M&C Table F-I):
Net borrowing of bank loans by UK non-financial businesses (PNFCs and public corporations) was £0.4 billion in October, compared to a net repayment of £0.4 billion in September. Net borrowing by large non-financial businesses was £2.0 billion in October, compared to £1.1 billion in September. Small and Medium sized non-financial businesses (SMEs) repaid £1.6 billion, on net, rising from a £1.5 billion net repayment in September.
The annual growth rate of borrowing by all large businesses increased to 0.9% in October, the first positive growth rate since February 2021 (Chart 4).
The average cost of new borrowing from banks by all PNFCs rose by 1 basis point to 1.89% in October. The rate in October was slightly below the average seen since March 2020 (1.93%).
The net loan repayment by SMEs of £1.6 billion in October was the largest on record and the seventh month in a row of net repayments by SMEs. The annual growth rate fell to -2.0% in October, the lowest since January 2015.
Interest rates on new loans to SMEs rose by 6 basis points to 2.43% in October, remaining well below January 2020 rates (3.37%).
Chart 4: Annual growth of lending to SMEs and large businesses
Market Finance (M&C Table F):
Private non-financial companies (PNFCs) raised a net £0.3 billion in market finance in October (Chart 5). This compares to an average of £0.7 billion raised in the twelve months to September 2021. There was a net issuance of bonds of £1.2 billion in October, whilst equity and commercial paper saw net redemptions of £0.5 billion and £0.4 billion, respectively.
Chart 5: Net finance raised by PNFCsfootnote 
Seasonally adjusted net flow
Businesses’ deposits with banks:
In October, UK non-financial businesses withdrew a net £5.3 billion from banks and building societies in all currencies, compared to a net deposit of £4.4 billion in September.
The effective rates on new time deposits increased by 3 basis points to 0.10% whilst effective rates on stock sight deposits for PNFCs remained unchanged at 0.04%.
Aggregate money (M4ex) and lending (M4Lex) (M&C Table J)
Sterling money (known as M4ex) increased by a net £15.1 billion in October, down from £16.7 billion in September. Households’ holdings of money weakened with net flows of £5.5 billion compared with £9.0 billion in September, although remained above the average of £4.7 billion in the twelve months to February 2020. PNFCs’ holdings (on a seasonally adjusted basis) increased by £0.9 billion, compared to £4.9 billion in September.
Sterling net lending to private sector companies and households, or M4Lex, grew in October from £3.7 billion to £13.6bn.
There is a discrepancy between the total of net finance raised and its components due to the seasonal adjustment methodology