Credit card defaults exceed £1 billion

For many people credit card debt has become the bane of their lives over recent years. Many consumers are struggling with their finances to a degree where they are struggling to pay bills and keep up with basic financial commitments, and this has resulted to some people turning to their credit cards to fund everyday expenses. However, with finances becoming increasingly difficult for some people there are many that have found that they are not able to make payments on the credit card debt that they have accrued.

This is reflected in recent figures that show credit card defaults have now exceeded £1 billion. In the last three months of last year banks are said to have written off £1.18 billion worth of debt on credit cards, which has increased from £740 million in the previous quarter. The figures were released recently by the Bank of England.

During the whole of last year banks are said to have written off a total of £9.71 billion of secured and unsecured debts. There was a 22 percent increase in cancelled mortgage debts with £163 million being written off in the final three months of last year. A range of factors have contributed to the financial difficulties that have left so many people unable to make repayments on their debts and financial commitments, including job losses, soaring living costs, and government cutbacks.

An official from the Consumer Credit Counselling Service said: “We are still seeing a high level of consumers coming in struggling with their debts, but most people have lower levels of debt. The problem is that, at best, we have households with stagnating incomes and rising costs, and at worse, households that have suffered from job losses and higher costs.”

Tags: unsecured debts, consumer credit counselling, England, Unsecured debt, range, mortgage debts

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