Lloyds: Customers have less than £500 worth of savings

Charlie Nunn also said the number of customers seeking debt advice jumped by a third in the first six months of 2022, with credit card spending on travel up 300% on last year, but the majority of Lloyd’s customers were worried about the cost of living. It was also possible for the UK to avoid the recession many are predicting. 

Speaking to the BBC, he said: “80% of individuals and UK customers and families have less than £500 worth of savings in their current account and their savings account. They might have money elsewhere. 

“But what we can see is less than £500. So it’s a very important starting point for looking at financial resilience.” 

He did however say half of these customers had increased their balances in the last few years and were in a healthier position than they were before the Covid pandemic. Looking at its consumers as a whole, Lloyds found 75% of its 26 million customers were worried about the cost of living while 20% of them were cutting discretionary spending to afford essentials. 

Nunn said: “Customers are concerned - and they should be. We’ve seen some areas where there’s real points of challenge.” 

Looking at house prices as a whole, Lloyds’ chief executive predicted the economy and house prices would both be roughly flat for the rest of year but sees interest rates rising to around two percent in the next year from the current 1.25%. This is much lower than the 3.5% others are predicting as high energy prices do a similar job as rising interest rates. 

Nunn explained: “We’re saying no, we’re saying we can see that it’s going to be a difficult few quarters of flat growth. 

“It could be plus or minus a bit but it will be flat growth in the next few quarters and really what we’re focused on is making sure we’re providing support to those customers who are going to struggle to make ends meet and the businesses as well because there are some sectors and some businesses that also have that stress.”