UK recovery at risk because of reduced credit
The International Monetary Fund (IMF) has again stepped in to kick the UK economy when it is down. The association believes that the UK, more than any other developed country in the world, is at risk over the next few years from reduced levels of credit for both consumers and businesses. It is estimated there will be a shortfall of £280 billion this year between required loans and liquidity available, dropping to £150 billion next year. So what can the government do to relieve the pressure?
Unfortunately, the UK government and the UK regulators have tried many tricks and many strategies to encourage UK banks to increase liquidity in the loan market. However, at this moment in time UK banks are adamant that they want to see a recovery in the economy before they inject further liquidity into the system, creating the ultimate "chicken and the egg" scenario.
There is no doubt that the inability of consumers and businesses to refinance their operations and their personal situations will cause havoc in the marketplace. The housing market could again grind to a halt, bankruptcies and other debt arrangements will continue to grow and more and more people will see their jobs in jeopardy.
Share this..
Related stories
Is English football on the verge of a meltdown?
Rumours in the football world indicate that Hull City have effectively transfer listed all of their players in the attempt to reduce the company's debt while Portsmouth football club is still in significant turmoil and has again warned staff that January wages could be late for the third time in recent months. So is UK football and English football in particular on the verge of a meltdown? Whil...
Read MoreLook into changing mortgage lender, urges IFA
People who are not looking into changing mortgage providers could be "chucking away a hell of a lot of money", according to Adrian Kidd, an independent financial advisor (IFA) with Mint Financial Services.According to a survey by mform, as many as 40 per cent of mortgage borrowers have never changed their lender, while 14 per cent of mortgage borrowers do not look for a new deal and 13 per cent ju...
Read MoreDefaults on credit cards on the rise
More Britons have experienced problems meeting credit card debts during the last six months, a new report has revealed. According to a study conducted by MoneyExpert.com, 11 per cent of Britons missed a credit card payment at some stage in the six months to December 21st.In the six month period to June 4th last year, however, just nine per cent of those surveyed said they had defaulted on a credit...
Read MoreA&L fined £7m by FSA
Alliance & Leicester (A&L) has been fined £7 million by the Financial Services Authority (FSA), the regulator announced today. Shoddy sales practices for payment protection insurance (PPI) between January 2005 to December 2007 mean that many customers could have been mis-sold the cover, the FSA said.A&L was found to not have made it clear to customers that taking out the cover was voluntary.The p...
Read MoreEnergy companies criticised for direct debit policies
The UK energy sector has come under renewed attack this week with the revelation more than 60% of UK households are currently in credit with their energy companies, where funding is collected by direct debit. The figures breakdown to show the average energy customer using direct debit to cover their charges has overpaid by £74 for electricity and £84 for gas.
A quarter of the UK p...