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The high cost of credit: The need for more affordable alternatives to high cost credit

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High cost credit users

There are too many families on tight budgets who have to turn to credit as a ‘safety net’ to meet the costs of everyday essentials.

Many of these households are having to turn to high cost credit like payday loans, doorstep loans and rent-to own stores to cover their essential living costs.

What's the problem?

The regular use of high cost credit to meet essential costs can severely damage the already tight budgets of families who are struggling to manage. This can leave them particularly vulnerable to falling into problem debt.

What are the alternatives?

This report discusses the current affordable credit alternatives available to those who need to borrow regularly to meet essential costs. It finds that there are still serious gaps in provision as the most financially vulnerable on the lowest incomes are the most likely to struggle to access affordable credit.

Our recommendations

  • There is a need for clear and coordinated action to build more accessible and affordable credit alternatives for the most financially vulnerable
  • The Government should introduce or underwrite the development of a new scheme for no interest loans to help those who struggle to safely access any form of commercial credit

Download the report now for the full picture. 

Download now

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Our research and reports

As the UK's leading debt charity, we want to make millions more people aware of the help that StepChange Debt Charity offers. Take a look at our research on household and consumer debt for leading insights on problem debt across the UK.

Helping you become debt free...

“I wish to thank your staff for all the great help they gave me when I was in so much debt.
They were a pillar of support to me.” (Leslie, Essex)

Foundation for Credit Counselling Wade House, Merrion Centre, Leeds, LS2 8NG trading as StepChange Debt Charity and StepChange Debt Charity Scotland. A registered charity no.1016630 and SC046263. It is a limited company registered in England and Wales (company no:2757055). Authorised and regulated by the Financial Conduct Authority.

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© StepChange Debt Charity 2018