The Bank of England‘s latest Money and Credit statistics for November 2025 reveal a mixed but modestly improving picture of the UK economy, with increases in mortgage lending and consumer borrowing amid ongoing uncertainties. According to the data, net borrowing of mortgage debt by individuals rose to £4.5 billion, up from £4.2 billion in October, marking the highest annual growth rate of 3.3% since early 2023.
This uptick suggests a tentative revival in property market activity, despite persistent affordability challenges. Gross lending dipped slightly to £23.7 billion, while repayments fell more sharply to £19.4 billion, contributing to the net increase.
Mortgage approvals showed varied trends: approvals for house purchases edged down by 500 to 64,500, but remortgaging approvals climbed by 3,200 to 36,600.
Interest rates also ticked higher, with the effective rate on new mortgages rising to 4.20%—the first increase since February 2025—and the rate on outstanding stock reaching 3.90%.
These figures come against the backdrop of the Autumn Budget, which offered limited relief for homebuyers, and anticipation of December’s interest rate cut potentially stimulating further activity.
Consumer credit borrowing surged to £2.1 billion net in November, from £1.7 billion the prior month, driven by £1.0 billion in credit card usage and £1.1 billion in other forms like personal loans and car finance.
The annual growth rate for consumer credit hit 8.1%, with credit cards growing at 12.1%—the fastest pace since early 2024.
This reflects households leaning on credit to cope with seasonal expenses, such as Christmas costs, amid elevated living expenses.
Interest rates on credit products varied: overdrafts eased to 21.57%, but new personal loans rose to 8.68%, marking four straight months of increases.
Household deposits grew by £8.1 billion, including significant inflows into interest-bearing accounts and ISAs, while businesses saw net deposits of £1.4 billion after withdrawals in October.
Overall, the sterling money supply (M4ex) expanded by £15.3 billion, the largest since January 2025, fueled by households and financial corporations.
In response, KPMG’s Karim Haji, Global and UK Head of Financial Services, described the mortgage activity as indicating “a cautious return of confidence to the housing market.”
He noted that while the Autumn Budget provided scant affordability relief, December’s rate cut might “inject a little more life” into the sector to end 2025.
Haji was unsurprised by the consumer borrowing rise, attributing it to holiday spending pressures.
Entering 2026, Haji highlighted a theme of “fragility” with ongoing economic uncertainty and restrained consumer spending.
He emphasized the regulator’s focus on customer support, urging lenders to adhere strictly to rules like Consumer Duty, Fair Value, and Targeted Support.
This advice underscores the need for financial institutions to prioritize vulnerable customers in a volatile environment.
These developments point to a fragile recovery, where modest gains in lending and borrowing coexist with rising rates and cautious behaviors.
As the UK navigates post-Budget adjustments and potential policy shifts, stakeholders will watch December’s data closely for signs of sustained momentum.
KPMG’s insights reinforce the importance of regulatory compliance to foster stability amid these challenges.