Autumn Statement: Credit sector must ensure lending takes care of vulnerable borrowers

“The Chancellor opened his Autumn Statement saying that inflation is the enemy of stability, and backed this up with a range of fiscal measures designed to soften the impact of price rises on the most vulnerable in society. Inflation-linked increases to Universal Credit and pensions were accompanied by the biggest increase to the National Living Wage since it was introduced, and a decoupling of rents from inflation in the social rental sector. However, even if inflation comes down to the OBR’s forecast of 7.4% next year, millions will still be left wondering how they will make ends meet.

“The announcement of cuts to government borrowing will impact every corner of Britain, especially those reliant on government and local support. Alongside the announcement of substantial tax increases, this means today’s announcement is going to leave many feeling worried. It will come as little comfort that despite some wage rises this year, pay growth is in the doldrums, the UK is already in a recession, and consumers must brace for a difficult year.

“Consumers will be prioritising essential spending, especially those whose debts have been impacted by recent interest rate rises. The credit sector must continue to ensure that all lending is carefully considered and takes care of those that may find themselves vulnerable in the current financial situation.”

Jayadeep Nair, Chief Product & Marketing Officer, Equifax UK