UK banks have granted over 1m payment holidays on debts, while 27m people have been offered interest-free borrowing on £500 ($623) of their overdraft.
Industry group UK Finance said on Friday that banks and credit card providers had granted credit card repayment holidays to 700,000 customers. 470,000 payment holidays have been granted on personal loans.
“Many people across the country are facing financial pressures due to the coronavirus, and lenders are taking decisive action to help them through these tough times,” UK Finance chief executive Stephen Jones said in a statement.
“Payment holidays on loans and credit cards and interest-free overdrafts can provide much-needed support to those with short-term cash flow pressures, whether it’s to cover next week’s grocery shop or next month’s utility bill.”
Across the UK, 1.8 million people have applied for jobseekers allowance since the start of the COVID-19 pandemic, and 6.8 million people have been furloughed. The majority of people on furlough will see a reduction in their income.
“We would encourage any customers concerned about their financial situation to check with their lender, starting by looking at their website which will have the latest information on the support available,” Jones said.
Alongside credit card and loan repayment holidays, UK Finance said last month that banks and building societies had granted 1.2 million mortgage repayment holidays since the start of the crisis, equivalent to 1 in 9 mortgages.
Repayment holidays on credit cards, loans, and mortgages have been mandated by the UK’s financial watchdog to help people manage through the crisis.
Jones said payment holidays were only one options available to customers.
“A payment holiday may not be the right choice for everyone, and lenders have a range of options to help customers through the COVID-19 crisis,” he said in a statement.