When people fall into debt, the question of responsibility is always brought up. Generally, there are two schools of thought: take responsibility for your own actions or put the blame on someone else. Interestingly, new research from CRIF has revealed these differing opinions tend to correlate with the opinions of polar opposite age groups.
In its Banking on Banks 2024 report, CRIF found out how different generations respond to debt and financial responsibility, and how opinions differ in Europe and the US.
In the UK, those aged between 18-34 (51 per cent) are overwhelmingly less likely to believe the individual should be held accountable for avoiding unmanageable debt. Meanwhile, 88 per cent of those aged over 55 believe the person in debt has no one to blame but themselves.
By contrast, 18-34 year olds are more than twice as likely as over 55s to hold the government (25 per cent vs 12 per cent) responsible. Furthermore, they also see more onus on family (26 per cent vs 19 per cent) and friends (16 per cent vs two per cent) than their older counterparts.
Support has come to an end – now what?
Recent years have seen numerous government financial support packages in the UK. For example, the furlough scheme during the pandemic, and more recently, the Energy Bills Discount Scheme which helped people with rising energy costs. It ended in March 2024.
Given the widespread use of these packages, particularly among young people with furlough used by 30 per cent of under 24s, it’s unsurprising that many have come to expect financial support from the government. But with many support packages ending, the onus is on banks and lenders to support people with their financial concerns. In fact, 50 per cent of all people in the UK put the onus on banks and lenders to prevent unmanageable debt.
Sara Costantini, regional director for the UK and Ireland at CRIF
Sara Costantini, regional director for the UK & Ireland, CRIF, said: “Our research underscores significant generational and cultural divides in perceptions of debt responsibility.
“Against an uncertain economic backdrop which started with the pandemic and now continues with the cost of living crisis, many young people have become accustomed to financial support from other sources like the government.
“With government schemes having come to an end, however, banks and lenders can fill the gap and ensure they offer their customers the support they need as the UK’s economic challenges continue.”
Is the sentiment shared beyond the UK?
Seventy per cent of French consumers say that banks and lenders should be held accountable. However, in the US only 32 per cent say the same. The report indicates potential cultural and regulatory differences influencing consumer expectations when it comes to credit and lending.
Interestingly, British consumers (14 per cent) put the least amount of responsibility on the family when compared to other European countries. For instance:
24 per cent of Italians
20 per cent of Germans
20 per cent of French
16 per cent for Aussies
25 per cent of Americans
Leonardo Piva, corporate business development senior director, CRIF
Leonardo Piva, corporate business development senior director, CRIF, said: “The perspectives of consumers showcased in our report highlight how important it is for banks to meet the ever-evolving requirements of their customers.
“With half the people in the putting the onus on banks and lenders, it’s clear that financial institutions need to do more to support their customers from falling into a debt spiral. One of the solutions lenders can add to their arsenal is open banking, which can provide them with a greater insight into someone’s financial situation and ability to afford credit.”
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