In Focus Commercial Credit
Banks and other lenders have continued
to tighten their credit standards in response to the Bank of England’s concerns around consumer over-indebtedness, which means many people have lost a fall-back option they may have used in the past.
The length of time consumers have to
repay zero-interest credit cards has shortened, which may partially explain why consumer credit-card repayments overtook new borrowing at the end of last year, for the first time since 2013. It is worth remembering that insolvency
Bankruptcy and Debt Relief Order numbers do not really have the same issue and it is, therefore, notable that both bankruptcy and Debt Relief Order numbers have been moving up – albeit slowly and inconsistently – over the last few years. Bankruptcy numbers are now the highest they have been since 2014
February 2020
procedures are only a rough guide to the true scale of individual indebtedness in the UK. Often, the question is about access and
whether someone who is unable to maintain their level of debt can meet the criteria to enter an insolvency procedure. The personal insolvency figures are only
part of the picture showing the true level of serious financial trouble for individuals. Although increasing indebtedness is a factor
in rising Individual Voluntary Arrangement numbers, market factors, such as the ability of practices to handle large numbers of cases, also play a role.
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Bankruptcy and Debt Relief Order
numbers do not really have the same issue and it is, therefore, notable that both bankruptcy and Debt Relief Order numbers have been moving up – albeit slowly and inconsistently – over the last few years. Bankruptcy numbers are now the highest
they have been since 2014. There are measures being taken by the
government to help people in financial distress. The ‘breathing space’ for people in debt
is due to be introduced next year, and will give indebted people a 60-day period free from creditor action to seek qualified advice as to the best way for them to resolve their situation. We have campaigned for the breathing
space for many years and we are very pleased to see that it is nearing its launch. CCR
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