Posted: Mon 26th Dec 2022

Looming financial crunch for households as millions miss payments in December

News and Info from Deeside, Flintshire, North Wales
This article is old - Published: Monday, Dec 26th, 2022


Campaign Advert

A consumer champion is warning that households across the country could be heading for even more financial pressures in January – as 1.9 million households missed payments in the lead up to Christmas.

According to the latest findings from Which?’s Consumer Insight tracker, an estimated 1.9 million households missed or defaulted on at least one mortgage, rent, loan, credit card or bill payment in the last month.

Missed payment rates generally tend to be lower in the lead up to the festive period and peak in January – when many households need to pay back their Christmas expenses as well as their usual household bills.

Which? research this time last year showed an estimated 1.7 million households missing at least one payment – but that number shot up to 2.5 million in January 2022.

The consumer champion has saaid figures could repeat themselves again in the coming weeks, “with many households in an even weaker position to cope with the combined pressures of Christmas and the cost of living crisis.”

In the last month, Which? found that renters were more likely to miss a housing payment, than mortgage holders.

Of those surveyed, 3.1 per cent reported having missed a loan or credit card payment and 4.6 per cent reported having missed a bill payment.

The most common type of bill missed was energy, at 2.3 per cent of households, followed by council tax (1.9%), phone (1.6%) and broadband (1.4%).

Just under six in 10 people made at least one financial adjustment – such as cutting back on essentials, selling items or dipping into savings – in the last month to cover essential spending. This equates to an estimated 15.8 million households.

This is a significant increase on the four in 10 seen this time last year, but lower than the peak of two-thirds (65%) making adjustments in September  2022.

With the UK heading into recession, mortgages and rent costs rising and the energy price guarantee becoming less generous from April, consumers will only face further financial pressures in 2023.

Which? said it is concerned that “millions of households could be facing a financial crunch in the New Year as they struggle both with outstanding Christmas payments and the rising cost of living.”

“If consumers are missing or struggling to afford essential payments – such as energy, credit card or mortgage payments – then they should speak to their provider immediately for help.”

With energy bill support due to be reduced from April, the government must ensure that people are not left struggling to make ends meet.

The government must also urgently work with energy firms to identify and resolve issues that are currently preventing customers on traditional prepayment meters from getting the support they need.

Which? has launched a campaign calling on essential businesses – energy firms, broadband providers and supermarkets – to do more to help consumers struggling to make ends meet.

For example, energy firms must ensure that their customer service departments are bolstered in order to be able to deal with high levels of queries and provide the urgent support that many customers will sadly need.

Rocio Concha, Which? Director of Policy and Advocacy, said:

“With 1.9 million households missing important payments in the run up to Christmas, we’re worried that many more people could be facing financial crisis in January – as the credit repayments pile up and the cost of living crisis continues to bite.

“As so many people face financial hardship, Which? is calling on businesses in essential sectors like food, energy and broadband providers to do more to help customers get a good deal and avoid unnecessary or unfair costs and charges during this crisis.”

Spotted something? Got a story? Send a Facebook Message | A direct message on Twitter | Email: [email protected]
Latest News

  • Wales urged to improve Do Not Resuscitate decision making processes
  • Millions missing out on smart meter benefits due to faults and poor supplier service, warns Citizens Advice
  • All six British UCI Continental Teams confirmed for inaugural Tour of Britain Women

  • More...

    Wales urged to improve Do Not Resuscitate decision making processes

    News

    Millions missing out on smart meter benefits due to faults and poor supplier service, warns Citizens Advice

    News

    All six British UCI Continental Teams confirmed for inaugural Tour of Britain Women

    News

    Police: Nuisance bike to be crushed after seizure

    News

    Deeside: Skills factory unveils new Industry 4.0 tech to train future generations of manufacturing workers

    News

    Help Wales Air Ambulance Mark 50,000 Missions with a 50-Mile Walk

    News

    Clwyd Gate Motel granted permission for light alterations despite concerns

    Denbighshire

    Music of the fifties set to be celebrated at special Chester concert

    News

    Survey demonstrates the positive international student experience at Chester 

    News