The credit crunch that has been causing turmoil in financial markets around the world is about to hit home with consumers in the UK, it has been suggested.
According to the Guardian’s economic expert Deborah Hargreaves, the problems that have been giving financiers nightmares will become a painful reality for thousands of families in weeks to come.
The practices of lenders in recent years has been singled out by Ms Hargreaves as being among the major reasons why millions of people are struggling to become debt free and why they are so vulnerable to an economic downturn.
Ms Hargreaves commented: “The financial engineering of recent years enabled banks to lend ever-increasing amounts since they were able to offload debts from their balance sheets.”
“The banks’ easy lending practices fostered a debt-dependant culture,” she added.
Accountancy firm Grant Thornton expects to see around 10,000 Britons enter insolvency every month this year as the impact of the credit crunch is felt across the country.