The credit crunch is further decapitating the financial market and it has been revealed that the number of people applying for loans and credit cards in the UK fell by eight per cent in the last quarter.

A new analysis on the froggybank.co.uk cashback network which followed a study of the habits of half a million consumers revealed that a growing number of people were unwilling to apply for loans or credit cards.

After comparing the buying habits of its 500,000 UK from April to June 2008 to the same period in 2007, it found that there was a rise the number of people switching utility providers to reduce their energy to 32 per cent.

“We are seeing clear signals that consumers are really feeling the pain in their purses right now,” said froggybank.co.uk’s marketing manager, Nadeem Azam.

He added that it was a great news for the cashback that people were doing everything they could to save money.

While some people were not applying for loans because they wanted to cut down on big purchases, many others were hoping to avoid the stress they might face in the process because they believed it was now harder due to the credit crisis, added Mr Azam.