Debt can have a significant impact on people’s lives and on a country’s development as well. With the ongoing economic uncertainty surrounding the coronavirus pandemic, many people are looking at consolidating their debt, whether through secured loans, balance transfer credit cards or remortgaging – and lowering the interest they’re paying. We explore how much debt the UK is in, both as a country and as individuals. Is the UK out of its depth or staying above water?
What's in this guide?
Quick overview
How much debt is the UK in?
- £1.680 trillion is owed by individuals in the UK (January 2020)
- On average every Brit spent £969 on interest alone last year
- 318 people are declared bankrupt every day in the UK (October to December 2019)
- £31,845 average debt per adult in the UK (January 2020)
- There is over £1.95 trillion public sector debt in the UK (May 2020)
- This is equal to 100% of gross domestic product (GDP) – the first time that debt as a percentage of GDP has exceeded 100% since the financial year ending March 1963
112%
Average debt of £31,845 per adult, is 112% of average earnings
Personal debt statistics
Personal debt is the money owed by individuals. It could be from a mortgage, credit card or short term loan, for example. We looked into how much is owed by the UK population.
| Year | Total debt (trillion) |
|---|---|
| 2012 | £1.420 |
| 2013 | £1.432 |
| 2014 | £1.463 |
| 2015 | £1.458 |
| 2016 | £1.512 |
| 2017 | £1.566 |
| 2018 | £1.616 |
| 2019 | £1.669 |
How much interest is being paid on debt?
These stats show just how much interest is costing the UK.
- Total interest payments on personal debt is over £51.1 billion based on January 2020 trends
- Borrowers paid £140 million in interest a day in January 2020
- Per household that is an average of £1,836 in annual interest repayments alone
- Per person that is an average of £969 a year in interest repayments
3.4%
Annual interest repayments of £969 represents 3.4% of average earnings
How big is consumer credit lending in the UK?
Consumer credit lending is the amount of borrowing done on credit – but can we afford to pay it back?
- £224.9 billion outstanding consumer credit lending at the end of January
- This is an increase of £560 million since December 2019
- Total credit card debt in January 2020 was £72.1 billion, a 0.3% decrease in the year to January 2019
- Per household this is £2,595 of credit card debt alone
26 years and 8 months
To pay back average credit card debt bearing the average interest, at the minimum repayment each month, it would take 26 years and 8 months
Consumer credit lending in the UK from 2012–2019
| Year (November) | Debt (Billions) |
|---|---|
| 2012 | £156.0 |
| 2013 | £158.9 |
| 2014 | £168.8 |
| 2015 | £178.15 |
| 2016 | £192.19 |
| 2017 | £205.8 |
| 2018 | £215.4 |
| 2019 | £225.3 |
How big of a problem is debt to individuals in the UK?
- 318 people are declared insolvent or bankrupt every day
- Citizens Advice dealt with 2,618 new debt problems every day in the year (to February 2020)
- 14 properties are repossessed every day (Q4 2019)
- 1,152 people a day reported they had become redundant between September and November (2019)
4 minutes, 17 seconds
Every 4 minutes a person is declared insolvent/bankrupt in the UK
National debt statistics
National debt is the debt owed by the government of a country, as a result of a budget deficit. This is where government spending exceeds government revenue, often resulting in government borrowing.
- Public sector debt is calculated at £1.950 trillion in May 2020
- UK GDP is over £2 trillion (£2.089 trillion)
- Public sector debt is equal to 100% of GDP he first time that debt as a percentage of GDP has exceeded 100% since the financial year ending March 1963(2018/2019)
- Compared to public sector debt of 34.2% in 2007/08 (pre financial crash)
| Year | Public Sector Net Debt as a percentage of GDP |
|---|---|
| 2007/08 | 34.2% |
| 2008/09 | 48.8% |
| 2009/10 | 62.9% |
| 2010/11 | 69.3% |
| 2011/12 | 72.9% |
| 2012/13 | 76.2% |
| 2013/14 | 78.1% |
| 2014/15 | 80.5% |
| 2015/16 | 79.9% |
| 2016/17 | 82.9% |
| 2017/18 | 82.4% |
| 2018/19 | 80.7% |
How does this debt compare to other countries
This level of debt may seem worryingly high, but how does the UK compare to other countries around the world?
- Sudan has the highest level of debt as a percentage of GDP, at 295%
- Japan has a debt of 252% of its GDP
- The UK sits 18th in the world for highest debt/GDP ratio
Debt interest
Borrowing money often incurs interest, even as a government. So how much is interest on the national debt costing the UK?
- In 2018/19, £48.7 billion was spent on interest repayments
- This amounts to 2.3% of the UK’s GDP
- 2017/18 represented the largest interest repayment of £55 billion
| Year | Debt Interest Payments (Gross, £ billion) | As a percentage of GDP |
|---|---|---|
| 2009/10 | £31.8 | 2% |
| 2010/11 | £46.8 | 2.9% |
| 2011/12 | £49.8 | 3% |
| 2012/13 | £49 | 2.8% |
| 2013/14 | £48.8 | 2.7% |
| 2014/15 | £45.5 | 2.4% |
| 2015/16 | £45.1 | 2.3% |
| 2016/17 | £48.7 | 2.4% |
| 2017/18 | £55 | 2.6% |
| 2018/19 | £48.8 | 2.3% |
| 2019/20* | £51.1 | 2.3% |
| 2020/21* | £48.7 | 2.1% |
| 2021/22* | £49.3 | 2.1% |
| 2022/23* | £49.2 | 2% |
| 2023/24* | £49.7 | 2% |
Figures from 2019/20 onwards are forecasted
Sources used
- IMF
- ONS
- The Money Charity
- OBR
Click here for more research. For all media enquiries, please contact:
Matt Mckenna
Head of UK communications
T: +44 20 8191 8806
