June 2025 FICO UK Credit Card Market Report: Overview and Analysis
UK Credit Card Trends Show Mixed Signals for June 2025
New data from FICO reveals a mixed picture for the UK credit card market in June 2025.
Spending and Balances
Average spending on credit cards reached £825 in June, marking a 4.6% increase compared to May but a 1.4% decrease from the same month last year. This reflects subdued consumer confidence, as the overall spending remains below the levels of June 2024.
Similarly, average credit card balances saw a 1% rise month-on-month to £1,885, and a 4.6% year-on-year increase. This suggests that consumers are carrying more debt, despite making fewer purchases.
Payment Trends
The percentage of payments made toward credit card balances declined by 2.1% month-on-month and 5.7% year-on-year, indicating consumers are paying down less of their balances.
Missed Payments
The number of customers missing one payment decreased by 11.3% in June and 16.8% annually. However, there was a 5.8% increase in the percentage of customers missing two payments. This mixed trend highlights growing payment difficulties among some consumers.
The average balance for accounts with three missed payments decreased by 0.3% month-on-month but is 4.9% higher than in 2024 at £3,200. Meanwhile, the average balance for accounts with two missed payments is £2,885, 2.9% higher month-on-month and 7% higher year-on-year. The average balance for accounts with one missed payment is £2,395, 0.6% higher than May and 7.2% higher than June 2024.
Implications for Lenders
These trends signal rising credit card debt levels combined with a decline in payments, which could lead to concerns for lenders about credit risk in the UK market. Card issuers should focus on early detection and specialised contact treatment, particularly for vulnerable customers dealing with high cost of living and year-on-year inflation.
Cash spend on credit cards increased by 2.8% month-on-month, suggesting that consumers are turning to credit to manage their finances amid economic uncertainty. This trend is expected to continue until September, according to predictions.
[1] FICO Market Data, June 2025 [2] FICO Market Data, Annual Report 2024 [3] Bank of England Inflation Report, June 2025 [5] Office for National Statistics, Consumer Price Index, June 2025
- Business analysts might find it concerning that personal-finance trends in the UK, such as an increase in average spending and credit card balances but a decline in payments towards balances, could signify rising credit risk in the business of finance.
- With personal-finance challenges compounded by economic uncertainty, some consumers may turn to credit cards for managing their finances more frequently, a situation that is expected to persist until September, as indicated by the latest data.
