12 million people in Britain to struggle paying bills
Some 12 million persons in Britain will probably struggle with bills and loan repayments as the COVID-19 pandemic continues to wreak financial havoc, a Financial Conduct Authority survey tracking consumer financial resilience showed on Thursday.
The survey, conducted in July, found 12 million people in Britain had low financial resilience and also found that one-sixth of these persons had become financially vulnerable since February, after lockdowns to control the virus slashed incomes and resulted in a large number of job cuts.
The survey, where 7,000 people took part, showed that almost a third of adults have suffered a drop in income, while income for households has fallen by 25 % on average.
Black and Minority Ethnic respondents fared even worse, with 37% reporting popular to their incomes.
More than a third of respondents, who already had low financial resilience and had a home loan, said they were likely to fall behind on mortgage payments, while 42% of renters said these were worried about falling behind on their obligations.
36% of individuals feared falling behind on repayments linked to loans or bank cards.
"We want to remind consumers, especially those who find themselves newly in financial difficulty that lenders are able to present you with support," Sheldon Mills, the FCA's Interim Executive Director of Strategy and Competition said.
The regulator has put together a package of measures to make sure vulnerable households can access help after Oct 31, when earlier COVID-19 relief initiatives such as for example loan and mortgage payment breaks and the initial Job Retention Scheme expire.
It has also encouraged borrowers to seek free advice how to manage problem debts and urged banks and lenders to take care of customers fairly, adding that organizations should use customers to supply support before they miss payments.
Options to negotiate new repayment plans, suspend, reduce, waive or cancel any further interest or charges will most probably to customers, the FCA said.
However, banks would have to be transparent about how precisely such actions could result in increased costs over the permanent and how such support could impact personal credit profiles.
