British households are still feeling the pinch of the recession despite continuing low interest rates, according to research carried out for the Bank of England.
The NMG Consulting study discovered that debt levels still concern half of the households in the UK. More than 50 per cent of the households questioned said they found it difficult to meet the monthly payments on their unsecured loans, personal loans and credit cards.
Of the people looking to take out a loan, half are finding it difficult to find an available source and people with large mortgages claim it is extremely difficult to find a new mortgage.
Perhaps most concerning, the research found that although consumers are increasingly worried by their personal debt levels, they have not been taking advantage of the low interest rates to pay off their loans. Instead many people are becoming increasingly reliant on the cash available through their credit cards, despite rising interest rates being charged.
The Bank of England stated. "The burden of unsecured debt has risen this year, most likely reflecting a combination of weak earnings growth and the interest rates on unsecured debt remaining high over the past two years."
