May 10, 2013 Simon Williams
It has been a long, uphill battle for British consumers to climb out of the hole dug by the recession, but it appears things are finally on the verge of turning around.
Deloitte's most recent edition of the Consumer Tracker revealed that confidence is on the rise, with findings including:
- A 9 percent year-over-year increase in sentiment around disposable income.
- Three percent improvements in job security and levels of debt.
- Consumers being the most confident they've been since the Tracker originated in 2011.
"The macroeconomic environment for consumers is beginning to improve, albeit very slowly," said Ian Stewart, chief economist at Deloitte, according to KamCity. "Employment levels are up compared to last year and credit availability has improved."
Stewart's mention of credit availability is especially interesting because banks and financial institutions are still incredibly stringent when it comes to short term lending. Any consumer with a credit score at or near the subprime level has a very small likelihood of receiving a loan.
So where is this funding coming from? More than likely, the rise of alternative credit has helped.
Many alternative lenders use Payment Reporting Builds Credit scoring methods, which measures other financial factors like past utilities payments, as opposed to solely traditional credit scores. As a result, significantly more residents have gained access to funding.