Money Advice Trust calls for “further support”

The Bank of England’s (BoE) latest Money and Credit figures showing consumer growth increased to 5.2 percent in March 2022, from 4.5 percent in February 2022. The annual growth rate of credit card borrowing was 10.6 percent.

Outstanding balances for consumer credit stand at £200.8bn.

MAT, the charity that runs National Debtline and Business Debtline, found that one in four (25%) of UK adults have used credit to pay for bills or essentials, including food, water, rent, council tax and energy in the last three months.

It also reported almost one in five (19%) of people expect to have to borrow for money to pay for essentials in the coming three months. One in 10 have borrowed from friends or family as a result of rising costs.

The findings were based on an Opinium survey of more than 2,000 UK adults.

Joanna Elson, chief executive of the MAT, said: “Today’s figures, showing consumer credit borrowing continuing to rise, may be a sign of the mounting pressure on household budgets.

“Set against a backdrop of soaring energy costs and inflation at a thirty-year high, our concern is that more people are having to turn to credit to plug gaps in their budget. The risk is that this could be storing up problems further down the line if repayments are unable to be met.

“For households who are already in financial difficulty and whose incomes are unable to keep pace with rising costs, the situation is more urgent. Further support is needed now, including significantly uprating benefits and targeted help for people struggling with rising energy bills.

“Anyone worried about their finances should seek free, independent debt advice as soon as possible.”