UK Consumer Resilience Boosts Barclays’ Retail Banking

Barclays’ UK retail division posted a surprise 7% revenue increase to £3.1 billion in Q1 2025, defying predictions of a consumer downturn as British households prove more resilient than expected.

Key Drivers:

• Mortgage Growth: 12% increase in approvals (vs market decline of 3%)

• Deposit Margins: Net interest margin expanded to 3.2% (from 2.9%)

• Digital Engagement: Mobile app logins up 38% YoY

Consumer Trends:

1. “Layered Finance”: 42% of customers now use multiple Barclays products

2. BNPL Surge: “FlexiPay” usage up 62% among millennials

3. Regional Strength: Northern England deposits grow 15%

Economic Backdrop:

• UK wage growth holds at 6.8%

• Savings buffers average £17,500 per household

• Contactless payments hit 92% of transactions

Risk Factors:

• £900M in pandemic loans still outstanding

• FCA investigating overdraft fees

• London rent defaults rising