Consumer credit applications for credit cards, personal loans and hire purchase applications fell in April from a year ago and were also down from March, credit information provider Veda advantage said.

Credit card applications fell 13% from April 2008, and 17% from March; personal loan applications fell by 19% from a year ago, and 18% from March; and hire purchase applications fell 32% and 12%, respectively.

The signs are consumers are borrowing less as the economy and the labour market weaken and households try and minimise risk during the recession. Although unemployment rose by less than expected to 5% in March, it is still forecast to rise up to near 8% in 2010, meaning household spending is set to decline and negatively affect economic growth.

"The consistently downward trend across all credit categories points to a continued lack of confidence among consumers, and little appetite for borrowing that may expose households to unnecessary risk. Clearly, most New Zealanders believe the recession has yet to bottom out," Veda said.

Veda provides credit information on credit applicants to banks and financial institutions, and holds files on around 97.5% of the individual credit-active population and 100% of the commercial credit-active population in New Zealand.