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Overdrafts gaining popularity as loans dry up
Written by Bernard Kayden   
Monday, 30 June 2008

More and more Britons are taking out overdrafts as most of the Banks in UK have started to cut back on lending in relation to credit cards and personal loans.<br><br>

London (Shakespearefinance) June 30, 2008: In the recent months, it has been seen that a major part of the Briton lenders are shifting to overdrafts and are reluctant to credit cards and personal loans due to lending cut-backs by most of the UK banks.

The unprecedented rise in the demand for overdrafts is primarily due to Britons who are going for a switch of their current accounts and are ready to fund them with at least £1,000 a month. They can easily get an interest-free overdraft for a period up to 12 months by following this procedure.

It has been noticed that the borrowed amount on overdrafts has spiked suddenly since May 2007. During May, the amount of borrowings owed by the borrowers were close to £10.2bn. £1bn of this amount was wiped off from this debt by February this year but the debt rose to £9.6bn, a staggering rise of £217m in one month, as per figures from the British Bankers' Association. The Banks are reluctant to offer credit cards and personal loans to customers and are offering to only those who enjoy a perfect credit score. The situation is made worsened with the rising food and fuel bills along with the credit crunch. This is the prime reason why the borrowers are preferring overdrafts over personal loans and credit cards. But since the overdrafts do not enjoy the best borrowing rates, due care is to be observed by a prospective borrower.

Alliance & Leicester, Barclays and Abbey all are offering an interest rate of 0% for 12 months for any legal requirement of the prospective borrower depending on his or her personal circumstances.

For additional information on the news that is the subject of this release (or for a sample, copy or demo), contact Webmaster or visit http://www.shakespearefinance.co.uk/
 
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