Furloughed Workers Struggle With Repayments
Consumer group Which? Has found that those people who have been on furlough during the Covid-19 crisis, are more than three times as likely to have defaulted on a payment than those who were not.
In not-so-surprising news, a recent survey by Which? Has found that those workers who have been on the furlough system (a Treasury-backed scheme where people are paid 80% of their salary, and has currently cost the taxpayer £31bn), are struggling to meet their regular financial repayments much more than those who are still getting paid 100% of their salary.
It is thought that around four million workers are still on the furlough scheme, with all or most of their wages being paid through the scheme, with many having reported missed a loan or credit card payment in the past four weeks.
It was also revealed that the number of those defaulting on housing payment (mortgage or renting) has doubled, with many admitting that they have defaulted on more than one payment in the last month. This means that as many as 500,000 missed payments in the last month alone!
Only The Beginning
Unfortunately, this debt crisis is only going to get worse. As the furlough scheme comes to an end in October, there is a suggestion that many businesses will have to make redundancies and/or close for good, as they come to the realisation that once they must fully pay their staff, the money simply isn’t there.
Richard Piggin, the head of campaigns at Which?, said: “Despite extensive action being taken by the government and the banking industry, it’s very worrying that people currently on the furlough scheme have reported experiencing much higher levels of financial difficulty than those who are working as normal.
“With just a couple of months until the scheme comes to an end, there is real concern that this gap could widen even further. The Financial Conduct Authority will also have to ensure consumers are provided with the help they need if they are in financial difficulty.”
Struggling To Meet Repayments?
If you have found yourself struggling to meet repayments recently, or if this crisis has simply pushed you even further into debt, please don’t hesitate in contacting our award-winning team of advisers. There is no cost for our advice and you under absolutely no-obligation to listen to our advice.
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