Britain’s debt epidemic has worsened, with the number of people in serious difficulties increasing by 400,000 in the past six months, figures showed on Thursday.
A total 8.4 million adults, a fifth of the population, now have unsecured debts of 10,000 pounds or more — up from 8 million in April, according to debt consultancy Thomas Charles.
Its study of 2,322 adults, undertaken by YouGov (LSE: YOU.L – news) , also uncovered a huge increase in the number of people struggling to meet repayments.
Some 2.5 million people said they regularly had problems repaying their debts — up 38.9 percent from six months ago.
Women were found to be feeling the strain the most. One in three women with debt of over 10,000 pounds said they were struggling to service it, compared to just one in five in April.
Men fared a little better, with just over a quarter reporting regular problems repaying their debts, up from a fifth earlier this year.
As more people struggle to meet repayments, the number of them teetering on the brink of insolvency has also rocketed.
Around 1.4 million adults (17 percent of those with debts over 10,000 pounds) said they were “quite likely”, “likely” or “certain” to declare themselves bankrupt or take out an individual voluntary arrangement (IVA) — a 27.3 percent increase from April.
IVAs are agreements with creditors to make reduced payments towards debts. After five years, the debt is classed as settled.
Of those with debts of 10,000 pounds or more, excluding mortgage borrowings, 21 percent of women and 15 percent of men said there was some likelihood of them becoming insolvent.
James Falla, a director of Thomas Charles, said: “We’re currently witnessing a correlation of increased borrowing alongside a massive decrease in the number of people coping.
“If action is not taken to curb borrowing trends in the UK, the situation is likely to spiral over the coming years; we could quickly reach a tipping point where those in financial trouble outnumber those who are not.”