Money and Credit - January 2026

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 decreased to £4.1 billion in January, from £4.5 billion in December, below the previous 6-month average of £4.5 billion.
• Net mortgage approvals for house purchases decreased to 60,000 in January, below an average of around 64,100 over the previous 6-months. Approvals for remortgaging decreased slightly to 38,100 in January from 38,400 in December.
• Net borrowing of consumer credit by individuals increased to £1.8 billion in January, from £1.7 billion in December, in line with the previous 6-month average of £1.8 billion. Within this, net borrowing through credit cards was £0.9 billion in January, up from £0.8 billion in December. Net borrowing through other forms of consumer credit (such as car dealership finance and personal loans) remained unchanged at £0.9 billion in January.
• Private non-financial corporations (PNFCs) borrowed, on net, £5.1 billion of finance in January, following net repayments of £1.2 billion in December. Within total net finance raised, bank loans amounted to £2.8 billion of borrowing in January, following £6.2 billion of net borrowing in December.
• The net flow of sterling money (M4ex) was -£7.1 billion in January, compared to £13.9 billion in December. This was largely driven by NIOFCs and PNFCs decreasing their holdings of money by £6.3 billion and £5.0 billion respectively. These decreases were partially offset by households increasing their holdings of money by £4.2 billion, within this households deposited £5.2 billion into ISAs, £3.1 billion into non-interest-bearing deposit accounts and £2.5 billion into interest-bearing sight deposit accounts.
• The flow of sterling net lending to private sector companies and households (M4Lex) was £10.5 billion in January, compared to £13.1 billion in December. January’s lending was driven by households, PNFCs, and NIOFCs borrowing £4.8 billion, £2.9 billion and £2.8 billion respectively, compared to borrowings of £5.5 billion, £5.1 billion and £2.5 billion respectively in December.

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 decreased to £4.1 billion in January, from £4.5 billion in December, below the previous 6-month average of £4.5 billion. The annual growth rate for net mortgage lending decreased slightly to 3.3% in January from 3.4% in December.

Secured gross lending increased slightly to £23.4 billion in January, up from £23.0 billion in December, still slightly below the 6-month average of £23.8 billion. Repayments increased in January to £19.1 billion, from £18.8 billion, below the 6-month average of £20.0 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).

Net mortgage approvals (that is, approvals net of cancellations) for house purchases, which is an indicator of future borrowing, decreased to 60,000 in January, from 61,000 in December. Approvals for remortgaging (which only capture remortgaging with a different lender) also decreased to 38,100 in January, from 38,400 in December.

The ‘effective’ interest rate – the actual interest paid – on newly drawn mortgages decreased, to 4.09% in January from 4.15% in December. The rate on the outstanding stock of mortgages was 3.90% in January, down from 3.92% in December.

Consumer credit (M&C Tables B and C):

In January, net borrowing of consumer credit by individuals increased to £1.8 billion from £1.7 billion in December (Chart 3), in line with the previous 6-month average of £1.8 billion. Within this, net borrowing through credit cards was £0.9 billion in January, up from £0.8 billion in December.

The annual growth rate for all consumer credit remained unchanged at 8.3% in January. Over the same period, the annual growth rate for credit card borrowing decreased to 12.3% from 12.4%, and the annual growth rate for other forms of consumer credit increased to 6.5% from 6.4% (Chart 4).

The effective interest rate on interest-charging overdrafts increased by 71 basis points, to 22.03% in January. The effective rate on new personal loans to individuals increased to 9.03% in January, from 8.78% in December. The effective rate on interest-charging credit cards increased in January, to 21.75% from 21.56%.

Households’ deposits (M&C Table J):

Households’ deposits with banks and building societies increased by £4.2 billion in January, following net deposits of £4.5 billion in December. This was driven by households depositing an additional £5.2 billion into ISAs, £3.1 billion into non-interest bearing accounts, and £2.5 billion into interest-bearing sight deposit accounts. These inflows were partially offset by withdrawals of £0.8 billion from interest-bearing time accounts (Chart 5).

The effective interest rate paid on individuals’ new time deposits with banks and building societies increased to 3.77% in January, from 3.76% in December. The effective rates on the outstanding stock of time and sight deposits were 3.34% and 1.73% respectively, compared to 3.35% and 1.75% in December.

Lending to and deposits from businesses

Businesses’ borrowing from banks (M&C Tables G-I):

In January, UK non-financial businesses (PNFCs and public corporations) borrowed, on net, £7.9 billion of loans from banks and building societies (including overdrafts), following £1.1 billion of net borrowing in December. Within this measure, large non-financial businesses borrowed £7.5 billion, following net borrowing of £0.8 billion in December. Small and medium-sized non-financial businesses (SMEs) borrowed, on net, £0.4 billion in January, following net borrowing of £0.3 billion in December.

The annual growth rate of borrowing by large businesses increased to 9.4% in January, from 7.7% in December. The annual growth rate of borrowing by SMEs increased slightly to 2.4%, from 2.2% over the same period (Chart 6).

The effective interest rate on new loans from banks to UK PNFCs increased by 7 basis points to 5.71% in January. The effective interest rate on new loans to SMEs remained unchanged at 6.14% over the same period.

Net Finance Raised (M&C Table F):

PNFCs borrowed, on net, £5.1 billion of finance in January, following net repayments of £1.2 billion in December. This was driven by £2.8 billion of net borrowing through loans from banks and building societies, £1.2 billion of net commercial paper issuance, and £0.9 billion of net bond issuance. These increases were partially offset by £1.9 billion of net equity buybacks (Chart 7).

Businesses’ deposits:

In January, UK non-financial businesses (on a non-seasonal adjusted basis) withdrew £24.5 billion from banks and building societies in all currencies, following net deposits of £13.0 billion in December. The effective rate on new time deposits from PNFCs decreased by 2 basis points to 3.37% in January, while the effective rate on stock sight deposits decreased to 1.97%, from 2.03% in the previous month.

Aggregate money (M4ex) and lending (M4Lex) (M&C Tables J and K)

The net flow of sterling money (M4ex) decreased to -£7.1 billion in January, from £13.9 billion in December (Chart 8). Within this, non-intermediate other financial corporations (NIOFCs) decreased money holdings by £6.3 billion and PNFCs decreased money holdings by £5.0 billion, compared to increases of £4.9 billion and £4.5 billion respectively in December. Households increased their money holdings by £4.2 billion compared to £4.5 billion in December.

The annual growth rate of M4ex decreased to 3.6% in January, from 5.0% in December.

The flow of sterling net lending to private sector companies and households (M4Lex) was £10.5 billion in January, compared to £13.1 billion in December (Chart 9). Within this, lending to households and PNFCs increased by £4.8 billion and £2.9 billion in January compared with £5.5 billion and £5.1 billion in December respectively. Net lending to NIOFCs increased to £2.8 billion from £2.5 billion.

The annual growth rate of M4Lex increased to 6.2% in January, from 6.1% in December.

Queries

If you have any comments or queries about this release, please email DSD_MS@bankofengland.co.uk.

Next release date: 30 March 2026