There was a slight increase in consumer credit lending in August, but the Finance & Leasing Association (FLA) has warned that this does not signify a recovery across the credit markets.

There were £24 million worth of secured loans taken out during August, 4% down year-on-year.

The total amount of new consumer finance in August was 3% higher than in August last year, but in the 12 months to August was down by 2%. The slight increase in August is likely to be due to holiday spending. the FSA said.

Lending through store cards, credit cards and in-store instalment credit remained low.

Fiona Hoyle, the FLA’s head of consumer finance, said: “The continued weakness in the credit markets shows the importance of ensuring that the government’s proposed new regulatory regime does not make it more difficult for responsible consumers to obtain credit.”””