Consumer Credit and Household Finances
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چکیده
In the 1990s, borrowing by households has grown quickly. In the early part of the decade, the growth was driven by housing lending (Graph␣ 1). More recently, growth in other personal borrowings has picked up sharply. particularly the widespread introduction of loan products enabling households to draw on equity in their owner-occupied property. This type of loan gives explicit recognition, in the form of reduced interest rates, to the security offered by households as collateral for borrowing. A further influence on the growth of personal credit has been the increasing household preference toward the use of credit cards to make payments, partly in response to changes in banking services, and partly to take advantage of reward programs. More generally, continuing economic expansion, with low inflation and low interest rates, has boosted confidence among households, increasing their willingness to take on new debt.1
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