The interest-free periods being offered on credit cards are expected to get longer in early 2022, according to a survey of banks and building societies.

       Long zero-interest periods could be useful for those trying to juggle their finances as households are squeezed by rising living costs.

       Energy bills, food shopping and other expenses are expected to put household finances under strain in the months ahead.

       The Bank of England asked lenders between November 22 and December 10 last year about their expectations for the period up to the end of February 2022.

       The latest survey was carried out before the Bank announced a 0.15 percentage point increase to the base rate, taking it to 0.25%, in December.

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       Lenders said the length of interest-free periods on credit cards for both balance transfers and purchases is expected to increase.

       They also expect demand for credit card borrowing to increase in the next few months, according to the Bank’s Credit Conditions Survey.

       Recent research from Moneyfacts.co.uk found that improvements to introductory credit card offers mean people can get balance transfer deals lasting for 35 months and introductory purchase deals lasting as long as 24 months.

       Rachel Springall, a finance expert at Moneyfacts.co.uk, said: “The amount of interest someone would pay on a typical loan of ￡3,000 on average would be more than ￡600.”

       But she said that, as an alternative, using a Virgin Money balance transfer card, for example, could potentially cost ￡88.20 in a transfer fee and provide a borrower with 35 months to pay off the debt before interest starts to kicks in.

       Ms Springall said: “If borrowers are struggling with their debts, then seeking help from a debt charity is wise and it’s always worth checking any credit score before applying for a card or loan too.”

       Mortgage demand, meanwhile, is expected to decrease in early 2022, according to the Bank’s survey.

       Last year saw a flurry of housing market activity as the stamp duty holiday prompted a rush of purchases before the deadline. Some of those purchases may have otherwise taken place this year.

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       The survey also found that business borrowing demand is expected to increase slightly among small firms early this year.

       Demand for loans will be unchanged for both medium-sized and large businesses, lenders predicted.