The need for responsible credit
Credit matters. Over the past thirty years households have become more reliant on credit as the means to secure homes, invest in education and skills, and smooth out fluctuations in income and expenditure.
Taken together these uses of credit can be a powerful driver for economic growth. Ensuring access to credit and confidence in credit markets is therefore vitally important, particularly when public spending is so constrained.
However, people also have problems using credit. They may use the wrong types of product for their needs and may take on too much credit, increasing their sensitivity to external income or expenditure shocks which can result in over-indebtedness, default, and insolvency.
Market failures are also apparent. Markets have become segmented with low to moderate income households excluded from mainstream provision. Price competition may be limited in sub-prime sectors and credit pricing and lending policies may accelerate the growth of wealth inequalities.
Learning the lessons from the global crisis we need to ensure that future credit provision is inclusive and achieve ways of balancing the demand for credit with responsibility in its supply and use as well as developing forms of provision to meet individual needs and wider social and economic objectives.
The Centre provides a dedicated resource to monitor developments in our credit markets, research models of responsible provision, and to develop practical policy proposals for national and local government. To this end, we provide a combination of news briefings, research and analysis, and policy driven events.
Buy the book! | 'Britain's personal debt crisis'
by CfRC Director, Damon Gibbons
'Britain's personal debt crisis: how we got here and what to do about it' is now available from Amazon. The book charts the rise of credit in the UK over the past forty years and provides an analysis of how this has damaged the resilience of households and our nation's economy as a whole. Importantly, the book sets out a radical agenda to address the current crisis and restore Britain's prosperity.
"Damon's book provides a timely insight into the power of personal debt to not just make life a daily struggle of the public but do long term damage to the future our country. He matches detailed analysis with a passionate call for action that many will find compelling"Stella Creasy MP
"Damon is one of those rare people who is able to combine a social policy researchers' attention to detail with a campaigners' zeal and passion to make change happen. The fact that he has managed to sustain this work for more than a decade, even when it has often meant swimming against the prevailing opinion of the times, is remarkable. Not only that, his analysis of the problems and solutions to Britain's personal debt crisis is always insightful, and almost always right!" Niall Cooper, Director, Church Action on Poverty