uSwitch calls for more responsible lending

It blames lenders for the rise in the amount of people taking out Individual Voluntary Arrangements (IVAs) because they cannot manage their debt .

In its Personal Finance Industry Insight newsletter, the website states that IVAs and the industry are likely to get investigated due to the rise in people using them.

However, the website also warns that not all firms offering IVA help are the same.

In addition, the website stated that Britain may be heading for a “credit crunch” as consumers start to wake up to the size of their personal debt.

It believes that this will make it harder for people to get new loans and that Britons could end up with a “major financial hangover”.