Cautious consumers' repayments on credit cards, loans and overdrafts outstripped new borrowing by �305m in February, figures show.
This safety-first approach had led to a contraction in borrowing through loans and overdrafts for more than three years, major banks said.
The figures, from the British Bankers' Association (BBA), showed a slowdown in activity in the mortgage market.
It said remortgaging levels were at their lowest for 13 years. 'Difficult economic times'
Despite their cautious approach, consumers still spent �7bn on credit cards in February - a similar level as the previous six months, the figures show.
Repayments outstripped new borrowing on credit cards by �39m in February. The repayment in unsecured lending was driven by weak demand, and continued payback, of loans and overdrafts.
Unsecured lending by the banks contracted by 1.8% in the 12 months to February.
"Businesses and households continue to be cautious about their finances in the face of difficult economic times and this shows up in a reluctance to take on new credit, or where possible, seeking to pay back bank borrowing," said BBA statistics director David Dooks. Mortgage dip
However, activity returned to more "normal" levels in February, said the group which represents the High Street banks.