Around one in seven, or 7.4m, UK adults struggled to pay their bills and credit repayments in January, according to a survey by the City regulator, as the cost of living crisis continued to bite.
While the figure was up from 10.9m people in January 2023, it’s still above the 5.8m recorded in February 2020, immediately before the Covid-19 pandemic hit and the cost of living squeeze began.
The Financial Conduct Authority (FCA) surveyed 3,450 UK adults who had previously completed its main Financial Lives survey in May 2022.
The equivalent of some 5.5m Britons said they had fallen behind or missed paying one or more domestic bills or credit commitments in the six months to January, down from 6.6m people a year before.
The most commonly missed payments during the six months were utility bills, followed by credit card bills and council tax.
The FCA said 62 per cent of renters had seen rent increases in the previous 12 months, with half reporting they were not coping financially or finding it difficult to cope.
Single adults with children, adults from a minority ethnic background and people living in the north east of England were also found to be more likely to experience financial difficulty.
In the 12 months to January, the equivalent of 2.7m people in financial difficulty sought help from a lender, a debt adviser or other financial support charity, with almost half (47 per cent) of these people saying they were in a better position as a result.
However, two in five adults who had fallen behind on their bills said they had avoided talking to their lender about their finances.
The FCA noted that it was making permanent the expectations on lenders to support borrowers in difficulty, which were introduced during the pandemic.
It introduced a new Consumer Duty last year, which has piled more pressure on companies to deliver “good outcomes” for customers.
Sheldon Mills, executive director of consumers and competition at the FCA, said: “Our research shows many people are still struggling with their bills, though it is encouraging to see some benefitting from the help that’s available.
“If you’re worried about keeping up with payments, reach out to your lender straight away. They have a range of support options and will work with you to agree the best one for you. You can also find free debt advice through MoneyHelper.”