A number of UK banks have reported that the volume of debt that they have been forced to write off over the last 12 months, has increased by a staggering 20%.

Bad debt is also affecting other sectors of the finance industry, with the credit card sector writing off a collective debt of just over £3 billion pounds in a similar time frame. It is suggested that the UK’s debt mountain is starting to have a serious effect on our economy, as consumers struggle with increased financial pressure, opting out of some credit commitments in favour of others.

Analysts fear that the UK’s unsecured debt problem may also affect other, stronger areas of the finance industry such as the secured or even the housing market. In response to the rising trend, a number of banks and other major unsecured lenders have tightened the reigns with regards to qualifying criteria.

Experts also feel that the statistics may be paving the way for a further increase in the number of IVA cases, in the not to distant future.