18 April 2005
A new report has suggested that consumers in the UK will look to fund approximately £11.9 billion from personal loans this year to consolidate existing debts.
Leading personal loan provider Sainsbury's Bank suggested that Britons are likely to borrow up to £40 billion in total but debt consolidation will be the most popular reason.
In all, debt consolidation will account for 30 per cent of all loans according to the report but experts have suggested that this is not necessarily the ideal way forward.
"By going down this route you're essentially paying for your borrowing twice," explained Citizens Advice spokesman Dan Levene to Reuters.
"Borrowing money to pay off existing debt is something people should think long and hard about. It's not necessarily the best way forward."
Consumers thinking about taking out personal loans are best advised to shop around and compare all available loans to find the best one to suit your immediate needs.
Compare all UK personal loans at uSwitch.com.
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