One in four people plan to borrow money for Christmas

The survey of 3,016 UK adults, commissioned by the Money and Pensions Service (MaPS), shows that one in four (26%) are likely to borrow or use credit for upcoming holidays like Christmas and Hanukkah.

Among those, half (52%) said they’re likely to use credit cards, while a third (35%) would use buy now pay later and one in four (24%) would opt for an overdraft. A sixth (17%) said they’d turn to friends or family and 9% would go to a credit union.

Some are considering using high-cost credit, with one in ten (12%) saying they’d use payday loans and one in 20 (6%) going for pawnbroker loans.

When asked how much they think they’ll borrow, almost half (45%) said between £101-£300. One in four (23%) thought £301-£500 and one in ten said more than £500 (11%).

The research also reveals how long they think it’ll take to pay back. One in five (18%) said 7-12 months, with a further one in ten (13%) saying longer than a year. 

This year, MaPS is asking those who plan on using credit to pay for Christmas or other religious and cultural holidays to “take a breath before you borrow.” This gives them time to assess their options and ensure they have a clear plan to repay the credit they take on.

MaPS is also urging people who are already struggling to use its MoneyHelper service, which offers free guidance on credit and finding debt advice.

Caroline Siarkiewicz, Chief Executive of the Money and Pensions Service, said: 

“The holidays are a wonderful time of year, but they can also make people feel pressured into spending much more than they can afford. With many households already feeling the strain, it’s unsurprising that millions are looking to credit to fund the celebrations.  

“What’s particularly worrying is that some will still be repaying when next year comes around. On top of the stress it can cause, this often involves using short term products for the sort of expensive, long-term borrowing they weren’t designed for.

“Credit is a useful tool, but it’s crucial to take a breath before you borrow. If things are getting out of hand, or you start needing credit for essential costs, it might be time to seek help. Whatever your circumstances, we have dedicated resources on our free MoneyHelper service and I’d urge you to have a look today.”

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• This survey was conducted among 3,016 people in the UK aged 18+ in October 2023. It is nationally representative.  
• According to the ONS, there are approximately 53.2 million people aged 18 or over in the UK.  
• Breakdown by UK country: Press release (Scotland)
• Breakdown by UK country: Press release (Wales)