Research conducted by Loqbox, the UK’s leading credit-building business, found that while many Brits in Greater London are looking to improve their financial health, understanding how to borrow responsibly remains a challenge. What are the biggest pitfalls people face when borrowing money, and how can you avoid costly mistakes? Loqbox’s latest survey, run in conjunction with research house Censuswide, sheds light on the UK’s borrowing habits and offers practical tips to help you navigate credit more confidently and take control of your financial future.

Key borrowing trends in Greater London:
45% of respondents in Greater London borrowed money in the last year– one of the highest figures in the country
Amongst borrowers in Greater London, 33% borrowed between £100 and £5000
Credit cards were the most used form of borrowing (47%), followed by personal loans (29%)
Only 23% always consider whether they can afford payments in the long term
Just 23% consistently pay off debts before borrowing more
16% relied on Buy Now, Pay Later (BNPL) for essentials like food and fuel
The most important factors when choosing a lender were:
– Customer service (30%)
– Trust in the lender (25%)
– Previous positive experience (25%)
-Payment terms (25%)
18% say they always read the small print when borrowing and just 2% say that they never do

Tom Eyre, CEO and Co-Founder of Loqbox, commented: “Credit can be a powerful ally in reaching financial goals, but without careful consideration of affordability and existing debts, it can quickly become overwhelming. Our survey highlights that while Greater Londoners are some of the most frequent borrowers, only 23% consistently factor in long-term affordability or clear debts before borrowing more. This raises concerns about financial stability and highlights the importance of making informed choices when taking on credit.”

However, it’s encouraging to see that just 2% of people admit to never reading the small print- the lowest figure of any region. This suggests an awareness of the need to understand borrowing terms, but more needs to be done to ensure people are not just reading the fine print but fully understanding the long-term impact of their borrowing decisions and empower them to see borrowing as a stepping stone to a richer life, rather than a setback.

“Borrowing should always work for you, not against you. With so many facing financial pressures, our mission is to provide simple, practical guidance to help people rebuild their confidence and manage their finances and credit with ease.”

It’s clear that financial education plays a critical role in addressing the challenges highlighted by the survey. The fact that 18% of respondents across the UK lack confidence in identifying regulated lenders illustrates a considerable gap in financial understanding that can lead to costly mistakes.

Tom added: “When people have the right financial knowledge, they’re better equipped to navigate credit cards and loans with confidence — sidestepping traps like sky-high interest rates and unmanageable repayments. But financial literacy isn’t just about avoiding risks; it’s a powerful tool for unlocking opportunities. From building a strong credit history to securing better borrowing terms, understanding how to use credit wisely can help people turn their financial aspirations into reality.”

Loqbox’s newly released guide, ‘How to borrow money: What people get wrong and how to get it right’, is here to help close the knowledge gap and empower smarter borrowing decisions. This comprehensive guide breaks down key concepts like APR, repayment terms, and how to verify reputable, regulated lenders using the FCA’s Financial Services Register. It also provides practical tips for managing credit — covering everything from balancing the risks and rewards of BNPL to building better financial habits that can boost your credit score.

Borrowing wisely isn’t just about avoiding pitfalls — it’s a stepping stone to long-term financial wellbeing. Loqbox’s guide includes actionable tips, such as setting repayment reminders, keeping a low credit utilisation rate, and leveraging personal finance apps to track spending. Ready to dive deeper? Download the full research report here: http://bit.ly/3TpGEpf