Consumers repay their debt for a fourth consecutive month

Britons repaid debt for a fourth consecutive month in October and at the fastest pace on record, the Bank of England said.

The Bank also released other data showing the money supply is still contracting in spite of £200bn of quantitative easing.

People paid off nearly £600m of unsecured debt such as overdrafts and credit cards last month – three times as much as City pundits had expected – and twice the repayment rate of September.

The figures show that the UK’s build-up of up to £228bn of unsecured debt in the decade before the credit crunch has now gone firmly into reverse, although since July consumers have only repaid £1.3bn of that total.

The figures also showed that new mortgage approvals inched up to 57,300 last month from 56,200 in September but remained well below the long-run average.