Bank of England publishes 2026 Q2 Credit Conditions Survey

The Bank of England published the results of its 2026 Q2 Credit Conditions Survey on 2 July 2026¹. The survey of banks and building societies asked lenders to report changes in the three months to end-May 2026 relative to the period between December and February, and expected changes in the three months to end-August 2026 relative to the period between March and May¹. It was conducted between 26 May and 12 June 2026, so any impact from more recent developments is not captured¹.

On supply, lenders reported that the availability of secured credit to households was unchanged in Q2, and expected it to increase in Q3¹. The availability of unsecured credit to households increased in Q2 and was expected to decrease in Q3¹. Overall availability of credit to the corporate sector was unchanged in Q2, though credit availability slightly decreased for small and medium businesses and was unchanged for large businesses¹.

On demand, demand for secured lending for house purchase increased in Q2 and was expected to decrease in Q3, and demand for remortgaging also increased in Q2 and was expected to decrease in Q3¹. Overall demand for unsecured lending was unchanged in Q2 and was expected to be unchanged in Q3, with demand for credit card lending slightly decreased in Q2 and expected to be unchanged in Q3, while demand for other unsecured lending increased and was expected to decrease in Q3¹.

On pricing, overall spreads on secured lending to households, relative to Bank Rate or the appropriate swap rate, widened in Q2 and were expected to narrow in Q3¹. Overall unsecured lending spreads narrowed in Q2 and were expected to narrow in Q3¹. The length of interest-free periods on credit cards for balance transfers decreased in Q2 and was expected to be unchanged in Q3, while the length of interest-free periods on new credit cards for purchases decreased in Q2 and was expected to increase slightly in Q3¹.

On defaults, default rates on secured loans to households were unchanged in Q2 and were expected to be unchanged in Q3, while losses given default on secured loans increased in Q2 and were expected to be unchanged in Q3¹. Default rates for total unsecured lending increased in Q2 and were expected to increase in Q3, with defaults for credit card and other loans both increasing in Q2; credit card defaults were expected to increase and other loan defaults were expected to be unchanged in Q3¹.

The Bank sets out how the figures are produced: responses are weighted by lenders' market shares, with lenders reporting conditions changed "a lot" assigned twice the score of those reporting "a little", and results expressed as net percentage balances scaled to lie between +/-100¹. A change is described as an "increase" if greater than 10 in absolute terms, "slight" if between 5 and 10, and "unchanged" if less than 5¹.

Why it matters for households

The survey reports what lenders said about the three months to end-May 2026 and what they expected for the three months to end-August 2026¹. For households, the reported widening of overall secured lending spreads in Q2 means the margin lenders charged on mortgages relative to Bank Rate or the swap rate rose over that period, with lenders expecting it to narrow in Q3¹. On unsecured borrowing, spreads narrowed in Q2 and were expected to narrow again in Q3, while the interest-free periods offered on credit cards shortened for both balance transfers and purchases in Q2¹. Default rates on unsecured lending rose in Q2 and were expected to rise further in Q3, while secured loan default rates were reported unchanged¹. The survey covers credit conditions and is separate from the FCA high-cost credit review and wider regulation and policy work; the Bank notes the results do not necessarily reflect its views on credit conditions¹.

What happens next

The 2026 Q3 Credit Conditions Survey will be published on 8 October 2026¹.