Credit card companies have been hit by a further spike in customers struggling to pay their bills, according to data from the Bank of England.

A net 25 per cent of lenders said they had seen a rise in borrowers failing to pay back what they owe in the second quarter of this year.

This is the highest level for two years and follows another large rise in the first three months of 2019.

There has been a 'significant increase' in defaults on credit cards – when consumers do not make their minimum payment. It has sparked fears that Britain's £73 billion credit card time bomb is about to explode.

The UK's debt outstanding on cards is £72.9 billion, a rise of 38 per cent since 2009.

Lenders have also warned they expect the length of credit card interest-free periods to become shorter in the coming months, according to the the Bank of England's Credit Conditions Survey.
This means new borrowers will have less time to clear their balance before interest charges start to kick in.

The survey found that the length of interest-free periods for balance transfers and new purchases both decreased in the three months leading up to the end of May.
In April This is Money revealed that Britain's total payday loan borrowing had spiraled to a phenomenal £1.2billion in 2018, according to Financial Conduct Authority figures.