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Credit card lenders get tough in face of debt

Growing personal debt is prompting many credit card lenders to turn down new applications, according to new research.

A study by MoneyExpert.com found that in the last six months, approximately 2.8 million people have had their credit card applications turned down.

This works out to about 15,555 rejections each day.

Bad debts were cited as the main reason, as many people were found to have reneged on repayments on their loans and credit cards.

Sean Gardner, chief executive of MoneyExpert.com, said: "It is entirely sensible for credit card companies to reject applications from people with debt problems or who look as if they have already borrowed enough."

He added that rising interest rates mean it is harder to service debts and that consumers should not be encouraged to get into further financial difficulty.

However, the firm expressed concern with the trend, as many people who genuinely need access to credit are being excluded in the general clampdown.

James Jones, from credit agency Experian, recently stated that only a minority of consumers struggle with credit and those who fall behind with their repayments only do so because of personal difficulties.

Click here to see how much you could borrow with a Lombard Direct personal loan.

28/03/2007 15:07:05

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