This year, nearly £203 million will be taken out in personal loans for ‘lifestyle’ purposes, says Sainsbury’s Bank. This is almost three times as much as last year, when the bank reported £73 million.

Lifestyle purposes include divorce settlements, cosmetic surgery and paying for school or college fees.

Although the main reasons for taking out loans are to purchase cars, consolidate debt or to pay for home improvements, the bank estimates that this year up to £58.22 million of university fees and expenses, such as travel and accommodation, will be financed through personal loans. 2004 will also see up to £7.23 million taken out in loans to pay for divorce settlements as well as £9.77 million of cosmetic surgery.

Steven Baillie, loans manager, Sainsbury’s Bank said: "Personal loan rates are lower than ever, making them affordable and practical for a host of different purposes which may explain the increase in lifestyle loans. As rates can vary, take time to shop around for a competitive deal, our rates now start from 6.1% APR, which is our lowest ever."

In addition to cosmetic surgery and divorce settlements, the bank’s research suggests that £30.6 million will be taken out in loans to pay for dental work and £46.75 million to help pay tax bills.

More unusual lifestyle reasons for taking out a personal loan with the bank have been to buy beach huts, flying lessons or even a plane.