The latest figures from the Bank of England (BoE) show this to be the highest monthly increase since July 2004, putting Britons’ total outstanding debt at £1.168 trillion.

However, unsecured borrowing, including credit cards and personal loans, is growing at the slowest annual rate in the last 12 years, 8.7 per cent.

A significant monthly rise in credit card lending in January can largely be attributed to the aftermath of the annual Christmas credit boom.

The mortgage market appeared to be faring particularly well, with 122,000 mortgages being approved – the same as in December last year.

Mortgage approvals are usually taken to be a relatively good indication of the future of the housing market, and the fact that there was no change here from December is a sign that things are still on track.

Total mortgage lending increased by £9.2 billion, the biggest increase in over a year and a half.

Nevertheless, Howard Archer, chief UK and European economist at Global Insight, felt that consumers were still being somewhat cautious following recent record repossessions and bankruptcies.

“While consumer credit picked up in January, it was still relatively muted,” he explained.

“Record high debt levels and rising unemployment means that there is an increased need for many consumers to try to repair their balance sheets.”

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© Adfero Ltd