Generic advice could ‘facilitate better borrowing’

Creating a generic financial advisory organisation could significantly lessen Britain’s debt problems and encourage a better attitude to personal loans and savings, it has been revealed.

According to research by the Resolution Foundation, if ten per cent of Britain’s lowest earners acted on the advice made available by such a service then the country’s credit card debt would fall by about 66 per cent to £830 million within four years.

Meanwhile, some £2.2 billion could be wiped off other forms of unsecured personal loans, as financial providers "facilitate better borrowing".

Chairman of the Resolution Foundation Clive Cowdery said: "Greater access to financial advice links a sustainable financial services market with the delivery of public policy goals.

"This creates a win-win situation for the government and the financial services industry."

The study added that medium¬-term savings would increase by a net total of £1.5 billion.

Findings by the Bank of England revealed personal loans witnessed a slight decrease during January, as about £10.6 billion was lent out over the month, compared to £11.3 billion in December.

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