Citizens Advice highlights problems with high cost credit as consumer borrowing increases

Today, the Bank of England’s latest money and credit statistics show consumer credit increased by 10.3% in the year to May, to £199.7 billion.

Citizens Advice says problems with poor affordability checks in the high cost credit market remain a key threat to borrowers.

Citizens Advice Chief Executive, Gillian Guy, said:

“Problems with poor credit checks in the high cost credit market are trapping people with loans they can’t afford.

“We’ve helped people with over 30,000 high cost credit problems in the last year, including borrowers who’ve been given expensive rent to own or doorstep loan agreements despite having very little income.

“High cost credit lenders must act responsibly to prevent people getting caught in cycles of debt. Turning the Financial Conduct Authority’s current guidance on affordability checks into rules would ensure lenders must carry out thorough checks on borrowers. It would also give the regulator more power to penalise high cost credit lenders who fail to do this.”

Notes to editors

  1. The Citizens Advice service comprises a network of local Citizens Advice, all of which are independent charities, the Citizens Advice consumer service and national charity Citizens Advice. Together we help people resolve their money, legal and other problems by providing information and advice and by influencing policymakers. For more see the Citizens Advice website .

  2. The advice provided by the Citizens Advice service is free, independent, confidential and impartial, and available to everyone regardless of race, gender, disability, sexual orientation, religion, age or nationality.

  3. To get advice online or find your local Citizens Advice in England and Wales, visit citizensadvice.org.uk

  4. You can get consumer advice from the Citizens Advice consumer service on 03454 04 05 06 or 03454 04 05 05 for Welsh language speakers.

  5. Local Citizens Advice in England and Wales advised 2.5 million clients on 6.2 million problems in 2014/15. For full service statistics see our publication  Advice trends .

  6. Citizens Advice service staff are supported by more than 21,000 trained volunteers, working at over 2,500 service outlets across England and Wales.