Credit card repayments 'fall to lowest level for 2 years'

According to research from analytics firm FICO, the majority of UK credit card holders are repaying less of their outstanding balance than at any time during the last two years.

The research revealed a fall in payment-to-balance ratios on accounts for classic cards. 'Classic cards' exclude premium cards, student cards and any credit cards issued in Ireland - all of which are recorded separately.

The number of classic cardholders taking cash advances from their credit cards has hit the highest level for 24 months. Average lines of credit on classic cards have continued to fall, with figures showing they've decreased by 4.3% since March 2011.

FICO vice president and managing director for Europe, the Middle East and Africa, Mike Gordon, commented: "The combination of flat spending on classic cards with lower payment percentages and higher cash usage indicates increasing strain on consumers' wallets.

"While one month is not enough to call a trend, we are monitoring these and other patterns closely to help our clients manage their card portfolios and understand changes in the UK consumer's financial health."