The amount of unsecured debt in the UK is increasing as more and more people get borrowing.
The average unsecured debt of a UK consumer is approaching the average income, standing at £7,080 - about 42 per cent of the average income.
Eleven years ago, the average unsecured debt stood at less than a third (29 per cent) of the average income, a percentage that equated to around £3540.
The increase in debt could be attributed to a rise in interest rates, but with rates widely predicted to fall later in the year some analysts are calling on consumers to begin paying their debts back now.
"I'd be surprised if we have a move in the next couple of months, but a move down to 4.5 per cent perhaps by October, at the latest November. I think it is inevitable given the weakness we are seeing in the economy," Bob Parker of Credit Suisse Asset Management told BBC Radio Four's Today programme yesterday. Click here to find out more about credit scoring if your debts are mounting.
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