Most households are in debt. Many face making repayments to multiple banks and finance companies at once, but some are trapped in an ever-intensifying cycle of borrowing to pay off old loans and to cover the costs of household emergencies.
The Financial Conduct Authority (FCA), set up in the wake of the finance crisis of ten years ago, reported on so-called ‘high-cost credit’ last week. It looked at the problems people caught in the spiralling debt trap face and was tasked with weighing up whether the interest rates and charges they are often forced to pay are fair.
Prior to publication we at New Economics Foundation expected the FCA to offer up a glass that, in the best case, be up to half full. And that has certainly been the case, with the proposals set out last week not adequate to not solve the deep, systemic and growing problem of…
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