The Financial Conduct Authority (FCA) predicted that 7.8 million people were struggling to pay their expenses, a rise of almost 2.5 million from 2020 when approximately 5.3 million people were struggling.
Almost six out of ten adults in the United Kingdom are struggling to pay their expenses, according to new research from the City regulator.
The Financial Conduct Authority (FCA) predicted that 7.8 million people were struggling to pay their expenses, a rise of almost 2.5 million from 2020 when approximately 5.3 million people were struggling.
It was predicted that 31.9 million people, or 60% of UK adults, found keeping up with expenses to be a “heavy burden” or “somewhat of a hardship” – an increase of around six million people since 2020.
One in four adults in the United Kingdom reported that they were in financial problems or would be if they had a financial shock.
In the six months preceding the study, approximately 4.2 million individuals failed to pay debts or loans.
The findings are part of the Financial Lives study conducted by the FCA between February and June 2022 with a sample size of 19,000 individuals. The complete results will be disclosed at the start of 2023.
The FCA reported that adults living in the most underprivileged parts of the United Kingdom were roughly seven times more likely to experience financial hardship than those living in the least poor areas.
In addition, 27% of black persons reported that keeping up with their payments was a strain, nearly double the percentage of the overall population, which was 15%.
12 percent of residents in the North East and 10 percent in the North West of England were found to be experiencing financial difficulties, compared to 6 percent in the South East and South West.
Sheldon Mills, senior director of consumer and competition at the FCA, stated, “Our research demonstrates that consumers around the nation are struggling to pay their expenses.
“If you are experiencing financial hardship, you do not have to battle alone. There is free debt counseling accessible, and we have instructed businesses to cooperate with clients to resolve any payment issues.”
It comes at a time when British households are facing a difficult winter, with rising electricity bills and food prices, and the possibility of planned blackouts if fuel supplies dwindle.
Food prices increased by 14.5% year-over-year, the biggest annual increase since 1980, while housing and utility costs increased by 20.2%.
The Office for National Statistics (ONS) reported that Consumer Price Index inflation reached 10.1% in September, up from 9.9% in August, as the economy suffered from the chaos generated by the mini-budget proposed by Liz Truss and Kwasi Kwarteng.
