Sharp rise in UK consumer debt among less well-off, thinktank warns

Industry News | 15/01/20

Low-income households have recorded a sharp rise in the use of potentially expensive consumer debt over the past decade and are now vulnerable to unexpected hard times, a thinktank has said.

While the Resolution Foundation dismissed fears of a debt crisis as overblown, it said the increasing use of credit cards, store cards and overdrafts by those struggling to make ends meet should concern policymakers.

The thinktank said consumer debt excluding mortgages amounted to 15% of total income in 2019 – well down on the 19% recorded in 2008, the last time the UK economy entered a recession. Mortgages were also cheaper to service as a result of historically-low interest rates.

Source: The Guardian