Data revealed today reveals that Britons were more reluctant to borrow on unsecured unsecured debts to fund their spending.

Net consumer credit fell to £1.2 billion in March from £2.3 billion in February, as the value of personal loans and overdrafts dropped by more than half. But although the data points to consumers being more cautious overall, consumers are still spending, adding to record debts of 1.4 trillion pounds.

Unsecured debts, such as credit cards, personal loans and overdrafts, are not secured against a property which makes them riskier for lenders, which explains why interest rates on these forms of borrowing are far higher than mortgage interest rates.

A major contributing factor of the decline in Brits taking out unsecured loans is simple, there just is not the range of loan products on the market and the ones that are available have seriously high interest rates attached to them. The days of cheaper loans for unsecured debts, that were available everywhere a few years ago, are all but gone with the credit crunch meaning that those willing to seek out unsecured loans will be paying pretty high interest rates for the privilege.