Retail consumer store credit soars despite lending squeeze

30th April | credit | Interest free credit and buy now pay later deals are helping furniture retailers defy the credit crunch. Store instalment credit, used to fund big-ticket furniture purchases, rose 8% year on year to £206m in February, according to the Finance and Leasing Association.

The jump in consumer borrowing defies trends in wider lending, with unsecured loans falling 45% in February and secured loans dropping by 83%. Most furniture retailers now offer some form of credit within their stores as a means of encouraging consumers to trade up or buy products they cannot afford to buy outright at the point of purchase.