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Few British households are having problems repaying their debts and those that are tend to be on low incomes and with unsecured borrowing, according to research published by the Bank of England.
In its Quarterly Bulletin, the bank claims consumers that devoted a large part of their income to servicing debt are typically on low incomes, so a form a disproportionately small share of consumption and the debt stock.
If a fraction of these consumers cut back on spending or defaulted on their debts, the impact on monetary and financial stability would be smaller than if their spending and debts matched those of the average UK household, claims
the report.
The research used a survey of just under 2,000 people, and may underline
policymakers' views that the recent jump in consumer bankruptcies is a social
problem rather than one that could affect financial stability generally.
Source:
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