Consumer indebtedness among UK consumers is showing signs of stabilizing, according to new figures released by a leading debt advice body.
The Consumer Credit Counselling Service (CCCS) has released figures that suggest fewer people were being declared bankrupt in the first quarter of 2006 than was the case last year, although the figures are not like for like.
The CCCS says that only one in seven consumers who contacted a charity for help with their repayments was advised to file for bankruptcy in Q1 2006, against a rate of around one in four for 2005 as a whole. The charity group added that the most common outcome for those approaching it for help was the debt management plan, where interest on the consumer’s debt is frozen in return for payments being made from spare income.
CCCS chairman Malcolm Hurlston says that the body noticed signs in 2005 that our clients were becoming more savvy and were in better financial shape to pay off their debts.
One cause for concern however is that the average amount of debt being shouldered by people contacting the CCCS in the first three months of the year was 7.5% higher than the same period in 2005, at GBP30,167.