Poverty, debt and credit

This research reviews the evidence on the links between debt, credit and poverty as part of the Joseph Rowntree Foundation’s programme to produce an anti-poverty strategy for the UK. Poorer households are known to be at increased risk of over-indebtedness and tackling debt is included within the UK Government’s Child Poverty Strategy1. Consumer credit is a part of everyday life for many people, helping to smooth the ebbs and flows of income and expenditure and manage financial resources flexibly. However, the concern is that use of consumer credit, particularly use of high-cost credit, can lead to financial difficulties and over-indebtedness. This review seeks to unpick the research evidence to provide an over-view of the extent to which problem debt and consumer credit use cause poverty; and the extent to which poverty results in problem debt and consumer credit use. (University of Bristol, Personal Finance Research Centre)

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