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‘No room for complacency’ as unsecured borrowing grows

Money Advice Trust comments on Q3 insolvency statistics and Bank of England Money and Credit report.
 
Insolvency Service statistics released today show there were 19,683 individual insolvencies in Q3 2015, up 2.8 percent on the previous three months but down 18.5 percent on the same quarter a year earlier.  Separate statistics from the Bank of England showed a continued increase in unsecured borrowing.
 
Joanna Elson OBE, chief executive of the Money Advice Trust, the charity that runs National Debtline, said:

“Despite this slight quarterly rise, insolvencies are much lower than they were a year ago and that can only be a good thing.  However, with household debt rising and higher interest rates on the horizon, there is no room for complacency.

“Today’s Bank of England figures confirm that unsecured borrowing is rising steadily, and overall household debt is now forecast to pass its pre-recession peak of 169 percent of household incomes in 2020.  Many households will be able to cope with this extra borrowing, but we are concerned that others are turning to credit to make ends meet.

“Increased borrowing and higher interest rates in the future mean that debt problems are likely to increase.  We need to send a clear message that anyone struggling with debt should seek free advice from a charity-run service such as National Debtline as early as possible.”
 
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