LONDON: With the Christmas spending over, consumers appear to be taking stock of their borrowings and seeking advice on how to manage them. Professional debt advice services have reported a substantial increase in calls from people wanting knowhow on managing debt.
The Consumer Credit Counselling Service said it had some 9,310 calls during the first nine working days of January, an increase of 14 per cent over the same period in 2005. Another agency, National Debtline, said it had received 13,000 calls between 3 January and lunchtime Friday last.
National Debtline said increased demand for advice had led to as much as two-thirds of the calls remaining unanswered in the first attempt. It is recruiting additional hands immediately, a spokesperson, Richard Gale, said. The more number of calls are mainly because consumers are now more aware of where to get help, and not simply because of any phenomenal rise in debt levels, Gale said.
As per statistics worked out by National Debtline, the average caller owed up to 15,000 pounds, but in some cases there were debts to the extent of 100,000 pounds. It is estimated that Britons have a cumulative debt of 1 trillion pounds constituting mortgages, loans, overdrafts and credit and store cards.
National Debtline said just 36,321 people called its helpline in the whole of 1994, while the figure rose to 131,206 in 2004.
According to government figures, some 12,000 people in England and Wales were declared bankrupt in the third quarter of 2005, one-third more than the number for the corresponding previous year period and the highest figure in 40 years.
Age Concern Enterprises, which works among the elderly in the country, said people who have crossed the age of 65 have an estimated collective debt of 8.4 billion pounds as of now. Many of the elderly citizens have no option but to finance seasonal spending through debt.
Accountants Grant Thornton say the number of personal insolvencies is likely to go up to 20,000 for the first three months of 2006.
Regulator Financial Services Authority has started a debt test recently to help those with debt problems. The service aims to make people with debt more capable and confident about their personal finances as the government is worried over as series of suicides resulting from debts.
Posted
on : Tue, 17 Jan 2006 14:50 GMT | Debt News
By : Salim Patel
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