A new survey has found that a significant proportion of people in the UK think it’s too easy to get into debt.
TDX Group online research, a Equifax company, adds an interesting new angle to the rising levels of consumer debt in the UK: the consumer perspective. Of 1,005 adults surveyed at the end of February this year, 45% said it’s too easy to get into debt.
Another 20 percent said banks and other lenders need to be more stringent about how much they lend to consumers.
The research comes after a year in which the bank of england and others have issued various warnings regarding rising levels of consumer debt. Meanwhile, in the P2P lending industry, signs of increasing default levels have appeared in the loan portfolios of consumer lending specialists, like Zopa.
In September last year, a study by alternative credit benchmark Aire suggested that nearly a third of credit card and personal loan debt – worth up to $ 35 billion of pounds sterling – relies on people who have low financial maturity.
The new TDX survey, conducted with Gorkana, found that 68% of people think a monthly debt repayment of more than 10% of their salary would be unmanageable.
Of those with outstanding loans, 25 percent see unexpected bills as the biggest threat to managing repayments, while 20 percent see rising cost of living as the main risk. If their debt levels got out of hand, 27% of respondents would turn to friends and family for help; Interestingly, 32 percent of women would take this course, compared to 22 percent of men.
“Personal debt is on the rise in the UK and it is increasingly important that consumers are aware of their level of debt, only accepting loans that they can afford to pay off,” said Richard Haymes, Head of Financial Difficulties at TDX Group.
“The high number of consumers who think it’s too easy to get into debt with high levels illustrates that banks and other lenders still have their work cut out for them to ensure that they only lend to those who can afford it. “
The new survey also contained information on consumer attitudes towards banking services. Of those polled, 47% believe bank accounts should be free and 83% would not pay their bank monthly fees in exchange for lower fees on overdrafts and overseas expenses. This statistic is likely to spark the interest of digital banks as a number of these companies are actively trying to roll out premium accounts for users.