Overview
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 UK banking system.
Key points:
- Net borrowing of mortgage debt by individuals increased to £4.8 billion in February, from £4.2 billion in January, above the previous 6-month average of £4.5 billion.
- Net mortgage approvals for house purchases increased to 62,600 in February, from 60,200 in January, below an average of around 63,500 over the previous 6-months. Approvals for remortgaging increased to 41,200 in February from 38,500 in January.
- Net borrowing of consumer credit by individuals slightly increased to £1.9 billion in February, from £1.8 billion in January, slightly above the previous 6-month average of £1.8 billion. Within this, net borrowing through credit cards was £0.8 billion in February, down from £0.9 billion in January. Net borrowing through other forms of consumer credit (such as car dealership finance and personal loans) increased to £1.2 billion in February, up from £0.9 billion in January.
- Private non-financial corporations (PNFCs) borrowed, on net, £2.6 billion of finance in February, following net borrowing of £5.1 billion in January. Within total net finance raised, bank loans amounted to £4.3 billion of borrowing in February, following £2.6 billion of net borrowing in January.
- The net flow of sterling money (known as M4ex) increased to £10.8 billion in February, from -£7.3 billion in January. This was driven by households, NIOFCs and PNFCs increasing their holdings of money by £5.8 billion, £4.4 billion, and £0.5 billion, respectively. Within this, households deposited £4.6 billion into ISAs, £2.2 billion into interest-bearing sight deposit accounts and £1.1 billion into non-interest-bearing deposit accounts.
- The flow of sterling net lending to private sector companies and households (M4Lex) decreased to -£3.2 billion in February, following an increase of £10.3 billion in January. Within this, NIOFCs accounted for £11.0 billion of net repayments in February, compared to £2.8 billion of net lending in January. This was offset by households and PNFCs borrowing £5.1 billion and £2.6 billion, compared with £4.9 billion and £2.7 billion in January, respectively.
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 and deposits from individuals
Mortgage lending (M&C Tables D and E):
Net borrowing of mortgage debt by individuals increased to £4.8 billion in February, from £4.2 billion in January, above the previous 6-month average of £4.5 billion. The annual growth rate for net mortgage lending increased slightly to 3.4% in February, from 3.3% in January.
Secured gross lending increased slightly to £23.9 billion in February, up from £23.6 billion in January, slightly above the 6-month average of £23.7 billion. Repayments decreased in February, to £18.4 billion from £18.8 billion, below the 6-month average of £19.9 billion.
Note: The difference between gross lending minus repayments and net lending figures is due to varying seasonal adjustment methods applied across these series (see Chart 1).
Chart 1: Secured lending inc. house purchase, remortgaging and other advances
Seasonally adjusted
Net mortgage approvals (that is, approvals net of cancellations) for house purchases, which is an indicator of future borrowing, increased to 62,600 in February, from 60,200 in January. Approvals for remortgaging (which only capture remortgaging with a different lender) also increased to 41,200 in February, from 38,500 in January.
Chart 2: Mortgage approvals
Seasonally adjusted
The ‘effective’ interest rate – the actual interest paid – on newly drawn mortgages slightly increased, to 4.10% in February, from 4.09% in January. The rate on the outstanding stock of mortgages was 3.95% in February, up from 3.90% in January.
Consumer credit (M&C Tables B and C):
In February, net borrowing of consumer credit by individuals slightly increased to £1.9 billion from £1.8 billion in January (Chart 3), slightly above the previous 6-month average of £1.8 billion. Within this, net borrowing through credit cards was £0.8 billion in February, down from £0.9 billion in January. Net borrowing through other forms of consumer credit (such as car dealership finance and personal loans) increased to £1.2 billion in February, up from £0.9 billion in January.
Chart 3: Consumer credit
Seasonally adjusted
The annual growth rate for all consumer credit increased to 8.5% in February from 8.3% in January. Over the same period, the annual growth rate for credit card borrowing decreased to 12.1% from 12.3%, and the annual growth rate for other forms of consumer credit increased to 6.9% from 6.6% (Chart 4).
Chart 4: Consumer credit growth
Seasonally adjusted
The effective interest rate on interest-charging overdrafts decreased by 17 basis points, to 22.00% in February. Over the same period, the effective rate on new personal loans to individuals increased to 9.06% from 9.03%. The effective rate on interest-charging credit cards decreased to 21.65% in February, from 21.75%.
Households’ deposits (M&C Table J):
Households’ deposits with banks and building societies increased by £5.8 billion in February, following net deposits of £4.3 billion in January. This was driven by households depositing an additional £4.6 billion into ISAs, £2.2 billion into interest-bearing sight deposit accounts, £1.1 billion into non-interest bearing accounts and £0.1 billion into interest-bearing time accounts (Chart 5).
Chart 5: Breakdown of households’ deposits (Household M4)
Seasonally adjusted net flow
The effective interest rate paid on individuals’ new time deposits with banks and building societies decreased to 3.67% in February from 3.77% in January. The effective rates on the outstanding stock of time and sight deposits were 3.31% and 1.72% respectively, compared to 3.34% and 1.76% in January.
Lending to and deposits from businesses
Businesses’ borrowing from banks (M&C Tables G-I):
In February, UK non-financial businesses (PNFCs and public corporations) borrowed, on net, £3.7 billion of loans from banks and building societies (including overdrafts), following £8.0 billion of net borrowing in January. Within this measure, large non-financial businesses borrowed £3.2 billion, following net borrowing of £7.6 billion in January. Small and medium-sized non-financial businesses (SMEs) borrowed, on net, £0.4 billion in February, following net borrowing of £0.3 billion in January.
The annual growth rate of borrowing by large businesses increased to 10.4% in February, from 9.4% in January. The annual growth rate of borrowing by SMEs increased to 2.8% from 2.4% over the same period (Chart 6).
Chart 6: Annual growth of lending to SMEs and large businesses
Seasonally adjusted
The effective interest rate on new loans from banks to UK PNFCs decreased by 5 basis points to 5.66% in February. The effective interest rate on new loans to SMEs increased by 12 basis points to 6.26% over the same period.
Net Finance Raised (M&C Table F):
PNFCs borrowed, on net, £2.6 billion of finance in February, following net borrowing of £5.1 billion in January. This was driven by £4.3 billion of net borrowing through loans from banks and building societies, £2.5 billion of net bond issuance and £0.3 billion of net commercial paper issuance. These increases were partially offset by £2.4 billion of net equity buybacks (Chart 7).
Chart 7: Net finance raised by PNFCs
Seasonally adjusted net flow
Businesses’ deposits:
In February, UK non-financial businesses withdrew £2.2 billion from banks and building societies in all currencies, following net withdrawals of £24.5 billion in January. The effective rate on new time deposits from PNFCs decreased by 9 basis points to 3.28% in February, while the effective rate on stock sight deposits decreased to 1.94%, from 1.97% in the previous month.
Aggregate money (M4ex) and lending (M4Lex) (M&C Tables J and K)
The net flow of sterling money (known as M4ex) increased to £10.8 billion in February, from -£7.3 billion in January (Chart 8). February’s deposits were driven by households, non-intermediate other financial corporations (NIOFCs), and PNFCs increasing their holdings of money by £5.8 billion, £4.4 billion, and £0.5 billion, compared to £4.3 billion, -£6.4 billion and -£5.2 billion respectively in January.
The annual growth rate of M4ex increased to 3.9% in February, from 3.6% in January.
The flow of sterling net lending to private sector companies and households (M4Lex) decreased to -£3.2 billion in February, from £10.3 billion in January (Chart 9). This was driven by net repayments by NIOFCs of £11.0 billion following net borrowing of £2.8 billion in January, offset by households and PNFCs borrowing £5.1 billion and £2.6 billion, compared with £4.9 billion and £2.7 billion in January respectively.
The annual growth rate of M4Lex decreased to 5.7% in February, from 6.2% in January.
Chart 8: M4ex sectoral components flows
Seasonally adjusted
Chart 9: M4Lex sectoral components flows
Seasonally adjusted
Chart 10: Annual growth of M4ex and M4Lex
Queries
If you have any comments or queries about this release, please email DSD_MS@bankofengland.co.uk.
Next release date: 1 May 2026
