With providers less willing to approve credit applications, many borrowers are having to turn to more expensive agreements, that are far more likely to plunge them into debt problems.
According to Credit Action, consumers are struggling more than ever to get credit from high street banks and are having to seek help from bad credit companies online. These loans and credit cards have much higher rates of interest that increase debt quickly.
However, director for the group Chris Tapp believes that people are less likely to want to borrow in the current climate, commenting, "It's likely to be a year in which, as the economy more generally slows down, the rate of borrowing will - to an extent - slow down with it."