Bad debt, rather than problems with the UK sub-prime market, has affected the changes in the credit market over recent weeks, according to an expert.

Spokesperson for the Consumer Credit Counselling Service (CCCS) James Ketchell said that high street banks were being “more particular” in how and to whom they lent money.

Bank of England figures revealed that bad debt write-offs by major UK banks rose to £2.1 billion in the first quarter of 2007, compared to £1.8 billion in the same period the previous year.

Mr Ketchell said: “Lenders are being a lot more particular in the way they lend, especially [due to] all the bad debt provisions that the big high street banks were having which were becoming a problem for them.”

He used the example of Barclaycard, which he said has a very high rejection rate for any new customers that want to take out a credit card with the company.

The CCCS is a registered charity that aims to help people in financial difficulty by providing free, independent, impartial and realistic advice.

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