U.K. Credit Card Default Rate Jumps at Start of 2019, BOE Says

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U.K. credit card defaults have risen to the highest level in almost two years, according to figures from the Bank of England.

Its index of defaults rose to 22.9 in the first quarter, according to its Credit Conditions Survey. That’s up from 12.7 at the end of 2018 and, along with the second quarter of 2017 is the highest since the financial crisis. It’s a further sign of strain on U.K. shoppers, who have had to deal with real-wage declines, forcing many to borrow to keep up spending.

While inflation has since slowed, and wage growth is starting to pick up thanks to the lowest unemployment in decades, the legacy of the pay squeeze is still being felt. Britain’s overall unsecured consumer debt pile, already more than 200 billion pounds, is still growing at an annual pace of around 6.5 percent.

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