UK consumers will be nearly £600 short for their bills and loan repayments as a result of Covid-19’s financial impact, a study has found.
Credit reference agency TransUnion’s consumer research study of 1,095 UK adults conducted on March 23-24, 2020, found three out of five (59 percent) households are already being negatively financially affected by the coronavirus outbreak.
That’s in stark contrast with research TransUnion commissioned just before the outbreak for its Consumer Credit 2020 report, where 60 percent of consumers surveyed they had the ability to withstand a financial shock. That survey of 2,000 UK adults was carried out in November 2019 by OnePoll.
The latest study shows that 70 percent of those consumers who feel they are affected are concerned about paying their bills, and say on average they will be short nearly £600 in the near future.
Much of this can be attributed to the fact that 39 percent of those impacted have had their working hours reduced, and that the impact is being felt across all ages, regions, ethnicity and income levels.
Of those worried about their ability to pay bills and loans, 59 percent believe they will be impacted within a month, while 34 percent said they will see the effects in between one and three months’ time.
They said utility bills (46 percent), rent payments (44 percent) and credit card bills (35 percent) are the key bills they will not be able to pay.
To help pay the bills, 35 percent said they will dip into savings, and 26 percent will seek to borrow from a friend or family member. Around 23 percent said they do not know how they will pay their bills or loan repayments.
Will North, director of core credit at TransUnion in the UK, said: “These figures give a stark picture of the immediate aftermath of the financial shock we’ve seen following Covid-19, with an indication of some difficult times ahead for businesses as consumers struggle to make ends meet. It’s more important than ever that credit providers have strategies in place to help them assess a customer’s financial standing and to be able to identify quickly those that may be struggling, so they can offer support if needed.”