More than seven million still struggling with bills, says watchdog
More than seven million people in the UK were struggling with bills and credit repayments in January, according to a financial watchdog.
The number is down significantly on the 10.9 million people in the same position in January 2023.
However, it’s still above the 5.8 million recorded in February 2020, before the pandemic and the cost of living crisis.
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Renters, single adults with children, adults from a minority ethnic background and those in northeast England were most likely to be in difficulty, according to Financial Conduct Authority (FCA) research.
Almost two-thirds of renters saw their rent increase in the previous 12 months, and half said they were not coping financially or were finding it difficult to cope.
Twenty-six per cent of renters had fallen behind on, or had missed paying, at least one of their bills or credit commitments in the previous six months – more than double the UK average of 11%.
Despite this, only 7% of renters missed a rent payment, with the report saying this showed many tenants prioritised this over other bills.
Financial firms must support customers and help them manage payment difficulties, the FCA said, adding that it had cracked down on firms not complying.
The research – based on 3,450 adults – showed two in five people behind on their bills had not spoken to their lender about it.
Debt advisers and support charities are also available to help – many of them for free – and 2.7 million adults said they had used these options in the 12 months to January.
Nearly half said they were in a better position as a result.
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Sheldon Mills, the FCA’s executive director of consumers and competition, said it was “encouraging” to see people benefitting from the help available.
“If you’re worried about keeping up with payments, reach out to your lender straight away,” he said.
“They have a range of support options and will work with you to agree the best one for you. You can also find free debt advice through MoneyHelper.”