According to a new report, the total consumer credit is expected to rise 3.1 per cent to £164 billion during the year, which is its highest level since 2010 as consumers are optimistic over household sector and wage growth.

The EY ITEM Club expects the consumer spending to rise in the country by 31 per cent after it rose 0.8 per cent in 2013. The report also showed that the rate of write-offs on consumer credit is expected to fall about 2 per cent by next year compared to 5.5 per cent recorded in 2010.

Andrew Goodwin, senior economic advisor to the ITEM Club said, "Last year we saw growth in credit card lending and demand for car finance recovering strongly but other forms of unsecured credit either fell or remained stagnant. This year we expect growth across the board - as well as a swell in consumer demand for credit cards, we expect stronger demand for big-ticket purchases, driving retail finance and personal loans, which will be good news for banks."

The national unemployment has fallen 7.1 per cent indicating that the jobs market is reviving in the country.