84% of people state they are feeling more confident in keeping up with their repayments as we enter what is traditionally an expensive time of year for many.

According to the latest quarterly Lloyds Bank Lending Report, confidence in paying off credit is high among consumers. 69% of those surveyed say that they are unlikely to need to borrow in the next 6 months.

Household income is the most common source used to make repayments, with usage increasing from 82% in Q2 this year to 85% in Q3.

People taking out personal loans online are significantly higher than loans taking out in a branch. 52% surveyed have applied online for loans, compared to 30% in a branch and 10% over the phone.

The main reasons for taking out loans include consolidating debts, purchasing a vehicle or lending to fund a special occasion.

The report also shows:

• 15% took out a loan to fund their own birthday
• 47% took out a loan to fund someone else’s birthday
• 19% of men plan to use a loan to fund an anniversary
• 12% of women plan to fund their anniversary through a loan.

Sam Clark, head of loans at Lloyds Bank, said:

“With an increase in consumers using household income to pay off existing credit, allied to the significant percentage of people saying they will not need to borrow more in the next six months, this paints a positive picture for consumer finances as we look ahead to the Christmas period.”

However, Gillian Guy, chief executive of Citizens Advice, said that mainstream debt problems such as credit cards and loans “only tell part of the story”:

“We are seeing increasing numbers of people come to us struggling with priority debts, like council tax and rent arrears.”