Data shows the outstanding level of credit card borrowing grew by 4.7% over the 12 months to December 2018.

There was £44.8bn outstanding on credit cards, which is the highest level recorded since UK Finance started gathering data in 1997.

Laura Suter, personal finance analyst at investment platform AJ Bell, noted that the figures also indicate changes to spending behaviour.

“More Brits are using their credit cards as a payment method and paying off the balance each month, in order to benefit from the cashback or the other perks a number of cards offer.

“This shows that some spenders are being savvy and getting the most out of their spending. But spenders are split in two, as the total debt we owe as a nation on credit cards continues to grow, with interest racking up for those who can’t afford to pay off their balances or switch to a better rate,” Suter explained.

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Around £11bn of credit card spending was recorded in December, representing an 8.8% increase year-on-year.

Meanwhile, the amount borrowed on overdrafts dropped over the 12-month period by more than 3%, while the amount owed in personal loans fell by more than 5%.

When it comes to loans to buy properties, mortgage approvals by high street banks were 2.4% lower in December in comparison to the previous year.

Savings accounts

The figures showed a 2.4% increase in the money that was allocated to easy-access savings accounts in 2018, bringing the total to £651.6 billion.

Meanwhile, cash in fixed rate bonds and notice accounts fell 5.9% to £197 billion.

“It means that 76.8% of all the cash we have in high street banks is now in easy-access accounts – making little or no interest,” Sarah Coles, personal finance analyst at investment platform Hargreaves Lansdown.

“And while it’s important to have an emergency fund of three to six months’ worth of expenses you can get hold of in a hurry, having too much in these accounts is a risky business.”

She adds that there is no easy access savings account on the market that keeps pace with inflation – which means that over time the value of your savings is eroded by inflation. However, there are fixed accounts from one to seven years which pay more than the current inflation rate of 2.1%.