Credit availability `inevitably` led to major personal debts

Increased availability of consumer credit in recent years has inevitably led to major debt problems, an industry association has claimed.

Financial services, including banks and building societies, have been "tripping over themselves" to lend money, leaving consumers with debt problems, R3 said.

Nick O`Reilly, vice president of R3, suggested consumer spending had fuelled economy growth in recent years, leaving total personal debts at record highs. He also claimed credit checks are less rigorous than they once were.

Mr O`Reilly added: "Now that the level of borrowing is so much bigger in terms of trillions, the level of people with debt problems is obviously higher than it used to be."

R3 is the brand name of the Association of Business Recovery Professionals, which is a major professional association for insolvency in the UK.