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Can consumer credit be affordable to households on low incomes?

832kb This study, which has been funded by the Friends Provident Foundation, draws on the work of Loughborough University's Centre for Research in Social Policy which has developed a Minimum Income Standard for different household types based on baskets of goods and services which people think are essential for life in Britain today. Our research focused on the additional costs of purchasing many of these essential items such as basic furniture, white goods, and Christmas presents on credit. It then calculated the amount of other necessities (for example, food and fuel costs) that would have to be foregone by people on low incomes if they were to maintain their credit repayments in four scenarios - borrowing from mainstream, sub-prime, high cost, and very high cost lenders. (Centre for Responsible Credit, 2011)

Keeping the plates spinning: Perceptions of payday loans in Great Britain

710kb Concerns have been raised in the US and the UK over the level of consumer detriment caused by payday lending, which has led to interest rate caps in a number of US states, effectively banning the practice. A central aim of our analysis is to understand who takes out payday loans in the UK. Are UK practices the same as those in the US, for example? It is also important to understand how payday loans fit into the market place alongside other forms of short-term borrowings such as overdrafts and credit cards. (Consumer Focus, 2010)

a nation living on the never-never:policy solutions to reduce Britain’s personal debt mountain

881kb UK personal debt has doubled over the past decade to £1.6 trillion, and is forecast to rise to £2.1 trillion by 2015 (taking the average household debt to £84,365). Total lending is now more than the country’s total output, with “stressed” unsecured borrowing reaching record highs. Do such high levels of indebtedness matter? Which groups are most at risk? How serious will the problem get? Do we have the right regulatory systems and agencies in place to cope with a personal debt crisis? And what alternative policies are on offer to deal with the wider impacts of the UK’s debt legacy? The contributors to this report have expertly grappled with these questions, collectively helping to push the issue of personal debt higher up the political agenda. (The Smith Insititute, December 2011)

A new approach to financial regulation: summary of responses to consultation on reforming the consumer credit regime

428kb A summary of the responses to a consultation which considered the merits of transferring responsibility for the regulation of consumer credit from the Office of Fair Trading (OFT) to the Financial Conduct Authority (FCA).(Treasury, 2011)

A vicious cycle

771kb This report shows how problem debt can have a persistent and invasive impact on the lives of families struggling to live on low incomes. It argues that eradicating child poverty in the UK is likely to be unattainable if the poorest families are trapped in a cycle of debt by the high cost credit sector. (Barnardo's, 2011)

Access to credit on a low income

166kb This research study explores the ways in which people on low incomes access and make use of credit facilities. It concerns the choices people make about credit and tries to reveal the reasons and factors that lie behind those choices. (Liverpool John Moores University, 2001)

Affordable credit - lessons from overseas

863kb This research report examines how the UK can most effectively ensure the provision of affordable credit to people on low incomes, particularly within the context of the available evidence on affordable credit emerging from other major OECD economies. (Consumer Focus, 2011)

Affordable credit for low-income households

556kb The findings from the research provide an in-depth profile of credit use among people on low incomes. Drawing on their experiences of using credit, the study then looks at what low-income borrowers want from a credit source, the key features that their ‘ideal’ source of credit would include and the perspective of lenders on lending to those on low incomes. (The Policy Press, 2005)

Affordable Credit: Lessons from overseas

863kb Consumer Focus commissioned the Personal Finance Research Centre (PFRC) to examine and report on how the UK can most effectively ensure the provision of affordable credit to people on low incomes, particularly within the context of the available evidence on affordable credit. (Consumer Focus and PFRC, 2011) emerging from other major OECD economies of France, Germany and Australia.

An Evaluation of the Access to Financial Services through Credit Union Project (Wales)

706kb A review commissioned by the Welsh Government into its Access to Financial Services through Credit Unions Project. The report gave a mixed appraisal of the project, noting that it had achieved and even exceeded many of its aims, but arguing that the Welsh Government needs to clarify what the aims of the project are. (2013)