An estimated 6.5 million Britons are at risk of serious debt problems as they turn to credit to support them when their income sees an unexpected gap….
An estimated 6.5 million Britons are at risk of serious debt problems as they turn to credit to support them when their income sees an unexpected gap.
A survey of 5,000 people undertaken by debt charity StepChange reports that eight per cent of people have used credit to cope with extreme changes to their financial circumstances over the last year. Across Britain this equates to four million people. A further five per cent stated that they had relied on a combination of credit and benefits to support them, equating to an additional 2.5 million people who have had to use credit to help them during a difficult situation.
Nearly one in three respondents (28 per cent) said that they had experienced a surprise change to their income within the last 12 months. According to Mike O’Connor, chief executive of StepChange Debt Charity, severe debt is not only a problem in itself, but it further affects a person's physical and mental health.
"With so many people at risk, we must take action to improve safety nets and ensure they are there for people the moment problems strike," Mr O'Connor says.
Problem debt costs society more than £8 billion every year, and further welfare benefits will not solve the problem. If a person or family falls into financial difficulty but are forced to use credit to support themselves, this will cause debt to build further.
Speaking of the widespread debt of individuals and families in Britain, Mike O'Connor said: "It is not a problem that can be ignored, and the case for taking action in terms of the value to individuals, their families and the wider society is clear."
By Amy White