Citizens Advice Scotland (CAS) have welcomed the UK government's announcement today of proposals to tackle credit card lending, and have claimed that too many Scots are 'drowning in debt'.
CAS Chief Executive Ms Kaliani Lyle said,
"Information from CAB staff around Scotland shows that personal debt is perhaps the biggest single issue facing our clients today, and there is no doubt that credit cards are a huge part of that.
"Earlier this year, evidence from CABs across Scotland showed that the average debt among our clients had risen over the last 5 years from £13,380 to £20,193. That's an astonishing increase. And the scale of the personal crisis facing these people is enormous. On average, For every £1 of their income, they are facing £28 of debt. In addition, creditors are being much less sympathetic with debtors than usual, and many of those who are in debt are suffering physical and mental ill health because of it (see statistics below).
"We have been calling for the government to make it a priority to deal with this situation. It's good that this consultation has been announced and we will certainly be putting forward our views, based on the case evidence we have from around Scotland. We welcome many of the proposals outlined, but we have more of our own.
"The important thing is that we need action fast on this issue, because too many people in Scotland are drowning in debt. It's time they were thrown a lifeline."
Earlier this year CAS released figures which showed that:
One in ten of the CABs' debt clients had debts of more than £50,000, with the amounts owed ranging between £100 and £239,346 (and this excludes mortgage debts!)
For every £1 of monthly income, these clients owed on average around £28 of debt. The ratio of debt to monthly income has risen by a quarter since 2003.
Creditors were pursuing debts more vigorously than in 2003 - with two-fifths reporting instances of aggressive harrassment.
Almost twice as many debt clients in 2008 had been threatened with unlawful debt recovery methods. The vast majority had charges and fees added to their debts due to their failure to pay on time.
Two in five clients – including half of all women – were going without essentials as a way of managing their debts, compared with one third five years ago.
Nine in every ten clients said debt had a negative impact on their health. Almost all said debt had affected their mental health, and a third their physical health.
Citizens Advice Scotland
For more details or to arrange interviews, please contact
Tony Hutson on 0131 550 1010 or 07774 751655