Top UK cities where debts have shot up over past year as average increases by 19% | Personal Finance | Finance

Debt levels have vastly increased over the past year as hard-up families struggle to cover rising bills.

Data from Creditfix data shows that unsecured debts are on average £18,040.39, a 19 percent increase from 2022 when average debts were at £14,943.

Stephanie Chapman, chief operating officer at Creditfix, said: “The cost of living crisis is continuing to cause huge disruption to personal finances across the UK.

“Rising prices for essential goods and services such as housing, utilities, and food, coupled with stagnant wages, have left many households struggling to make ends meet.

“As a result, more and more people are turning to credit cards and loans to cover their expenses, leading to a worrying increase in overall debt levels.”

Average debts have increased the most over the past year in Rotherham, increasing by almost 50 percent to almost £21,500.

Newcastle took the second place, with average debts increasing 38 percent, to just over £19,500.

The other three cities where debts have increased the most were Reading, Birmingham and Swindon.

Other figures show Birmingham is also the authority that set to receive the most £300 cost of living payments from next month, with 208,800 households to receive the funds.

These are the figures for the increase in average debts for the five cities:

Rotherham

2022 average debt: £14,542.92

January to September 2023 average debt: £21,469.75

Percentage increase: 48 percent

Newcastle

2022 average debt: £14,103.57

January to September 2023 average debt: £19,519.63

Percentage increase: 38 percent

Reading

2022 average debt: £14,687.81

January to September 2023 average debt: £20,087.12

Percentage increase: 37 percent

Birmingham

2022 average debt: £16,254.19

January to September 2023 average debt: £21,952.96

Percentage increase: 35 percent

Swindon

2022 average debt: £14,596.21

January to September 2023 average debt: £18,772.98

Percentage increase: 29 percent.

Greig Chesney, operations insight and analytics manager at Creditfix, said: “These figures show the impact that the cost of living crisis is having on households across the UK.

“Debt doesn’t discriminate, something that’s evident when you look at the data. The forecasted increase in debt servicing costs further highlights the long-term financial impact that the cost of living crisis is having on individuals and families.

“Although increases in pay are slowly beginning to catch up with inflation rates, regular pay across the board is up by 7.8 percent, and inflation currently stands at around 6.8 percent – it seems the damage may already be done.

“It is clear that urgent action is needed to address this issue and provide support for those who are being disproportionately affected by the high cost of living in the UK.”

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