With today marking one month until the Bank of England (BoE) will announce if there is to be an increase in interest rates, almost half (47%) of Britons are unaware of a possible increase.
CYBG’s digital banking service B also found over half (57%) admitted to not fully understanding how a rise in interest rates will impact their financial situation.
Two fifths (41%) of home-owning Britons are concerned about their ability to meet higher mortgage repayment and fifth (21%) said it would make it harder for them to afford higher repayments for other borrowings.
Helen Page, innovation director at B, said: “This research highlights the lack of awareness consumers have about what a possible interest rate rise means for them across all aspects of borrowing.”
The research suggests homeowners – and aspiring homeowners – will be hardest hit. A quarter (27%) of those already on the property ladder thought a rise would make it harder or near impossible for them to upsize.
And a fifth (18%) said it would make it harder or near impossible for them to buy their first home.
Page added: “We’ve seen a 50% year on year rise in customers wanting a five-year fixed rate mortgage.
“Clearly people are finding longer-term fixed rate mortgages increasingly appealing as there is security in knowing a rate rise won’t affect you.
“That said nearly three quarters (71%) of the consumers we surveyed aren’t preparing for a potential interest rate rise across all debt next month so some parts of the population are switched off to what a rate rise could do to their monthly budget.
“After years of interest rates remaining low it’s important that consumers prioritise getting financially fit and this means getting a full picture of how they will manage their finances – whatever the outcome of the BoE’s announcement next month.”