UK credit card payment rates drop and card balances rise as summer spending puts pressure on consumers
As summer spending rose in June, credit card data analysis by global analytics software leader FICO (NYSE: FICO) underlines the financial pressures facing UK households. Falling payments contributed to an annual increase in accounts with one, two and three missed payments. And with average balances across all three delinquent categories rising month-on-month, risk teams will need to maintain heightened monitoring for signs of pressure on affordability.
Highlights
- Average spend increased by 5.6% month-on-month, to £835.
- The average active balance increased by 1.4% month-on-month, reaching a new record high of £1,975. It is also 4.7% higher than June 2025.
- The percentage of balance paid decreased by 2.4% month-on-month to 33.3%, and remaining 4.4% lower year-on-year.
- The percentage of customers missing one payment increased 7.7% year-on-year, with the average balance on accounts with one missed payment 4.1% higher
- There was a 5.5% increase, month-on-month, in customers missing two payments and 9.1% year-on-year, with the average balance increasing 2.2% year-on-year
- For customers missing three payments, there was a significant 14.3% year-on-year increase, with the average balance 1.9% higher than the same month in 2025.
- Average credit limits increased by 0.2% month-on-month to £5,985, remaining 2.0% higher year-on-year.
FICO Comment:
June 2026 continued to present a mixed picture for consumer affordability. An increase in spending could, potentially, be seen as a good sign of economic confidence, however, the increase in spending was not matched by the percentage of overall balance paid, which fell on the previous month and year, reversing the previous recovery and continuing its persistent downwards trend. And with an increase in late payments across one, two and three months, a record-high average active balance will be of concern to risk teams.
Payment rates remain at historically low levels, close to the pre-pandemic average of 30%. With rising spending and payments to balance, the average active balance has maintained record highs, a trend that characterised the market throughout 2025 and into 2026.
In terms of missed payments, June saw a mixed picture across delinquency categories, with month-on-month improvements in one and three-cycle accounts offset by an increase at two cycles. However, all three delinquency categories remain higher year-on-year, continuing the concerning trend that emerged in the second half of 2025 and has persisted throughout 2026.
June credit card data indicates that underlying affordability pressures remain significant. Risk teams should maintain heightened monitoring of delinquency progression through the cycle buckets and ensure pre-delinquency intervention strategies remain calibrated to address the elevated balance levels now characteristic of customers in financial difficulty.
These card performance figures are part of the data shared with subscribers of the FICO® Benchmark Reporting Service. The data sample comes from client reports generated by the FICO® TRIAD® Customer Manager solution in use by some 80% of UK card issuers. For more information on these trends, contact FICO.