February 2013

RBS and the inevitability of payday loans

The headlines were about losses and bonuses, but the numbers in the Royal Bank of Scotland annual report for 2012 shone some interesting light on trends in loans and debt.

Bad debt charges were down by a third in the bank’s UK retail division, from £788million to £529 million, Credit Today reported.  The drop was driven by a “huge” reduction in bad debt levels on UK mortgages of almost a half.

Ads for payday lenders banned from university campus

The University of East London has banned advertisements for short-term, high interest lenders anywhere on its campus – and is looking into the possibility of blocking access to payday loan websites.

Staff at the university claim that some students who default on the loans and run up substantial debts are being forced to abandon their studies.  Others are said to have turned to sex work to meet their payments.

The ban includes advertisements in magazines, posters and websites.

Savings suffer as families help struggling relatives, says new research

The number of people saving for their future has improved fractionally on last year – but there are still almost 15 million who say they are not putting anything away, according to a new survey.

However the report, for Scottish Widows (part of the Lloyds Banking Group), also suggests that families are increasingly using their savings to support other family members.  Some 40% - up from 30% last year - said this amounted to "substantial amounts of money".

Open University course on Personal Finance

Been thinking that you really ought to learn more about running your finances?  Did you know that you can take a practical personal finance course with the Open University?

 The course, called ‘You and your money: personal finance in context’, is designed to develop personal finance understanding and skills. Students will consider themes that include how the economy and social change affects personal finances, and financial planning.    

Squeeze on household budgets forces cuts of up to 40 per cent in some areas of consumer spending

As High Street shops continue to close, new research shows that new clothes and home furnishings have taken the brunt of dramatic consumer spending cutbacks over the past five years.

The research, carried out for VoucherCodes.co.uk, suggests that consumers have cut back by 42 per cent on the money they feel able to spend on new clothes.  Spending on restaurants and home furnishings is next on the cutback list, at 30 per cent and 29 per cent respectively.

More than a third of bank loans used to consolidate debt

A new analysis of UK bank loans suggests that just over a third (35.2 per cent) of the total value of personal bank loans taken out in the first quarter of 2012 were used to consolidate debts.  This figure was up slightly (from 33.6 per cent) in the same period in 2011.

According to Sainsbury’s Bank, some 164,000 people took out loans valued at £1.6billion during that period. 

Celebrating victory as financial education set to become compulsory in school

While MPs and financial institutions were debating the best way to teach young people how to manage their money, pupils at Southlands High School in Chorley and national charity Debt Advice Foundation blazed a trail in financial education.

Today they were celebrating the announcement that the subject is to be made compulsory in secondary schools, as part of the Citizenship curriculum.