Nationwide has urged “struggling” households to get support as debt peaks in the New Year. Nationwide found January 2025 debt is set to be the highest on record while higher energy costs and tax returns will pile on more pressure.
Nationwide data shows debt repayments 4% higher this year vs 2023 as people borrowed more ahead of Christmas. Debt has risen since the pandemic: customers repaid £796m of debt in January 2024 – 43% more than 2021.
Nationwide has urged those struggling financially to get in touch with their bank or building society for support. According to Nationwide’s spending data, debt levels in November were already four percent higher than the same month last year, at £696 million versus £672 million, as more customers borrowed to cover the cost of Christmas.
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Nationwide’s data shows debt has been rising for a number of years, with the recent surge eroding positive gains made during the pandemic. In January 2024, customers made debt repayments of £796 million – a 43 per cent increase when compared to January 2021 (£556m) and a 29 per cent increase on pre-pandemic levels when £619 million was repaid in January 2020. As a result, debt in January is on track to be the highest since we started tracking prior to the pandemic.
Mark Nalder, Nationwide’s Payments Strategy Director, said: “December is always the peak month for spending, and many will turn to credit to fund their Christmas festivities. Unfortunately, this means many start the New Year with more to pay back. And with rising energy bills and annual tax returns, January could be a long month for many.
“This is why we traditionally see a jump in spending on holidays as people have something to look forward to. For customers who are struggling financially, whatever time of year it is, they should get in touch with our cost-of-living helpline for support in getting back on track.”