Shocking figures have revealed that people in Northern Ireland spiralled into £15m of new debt within 12 months.
And the report published today has led to calls from Citizens Advice for tighter regulation of the finance industry to stop the growing debt crisis.
The figures released in the Dealing with Debt Annual Report, which was funded by the Department of Enterprise, Trade and Investment, showed that 1,600 people were helped between March 2006 and March 07 by the Citizens Advice project.
The report also revealed the breakdown of the massive debt:
- £10m was personal credit
- £3.5m was personal loans
- £5.4m was credit cards
- £1.4m was bank loans
Derek Alcorn, chief executive of Citizens Advice in Northern Ireland, said that personal credit was behind the debt crisis.
"Of the £15m of debt dealt with over one year, £10m was personal credit, personal loans £3.5m, credit cards £5.4m and bank loans £1.4m.
"Against the complete collapse of public confidence in the finance industry which we have seen in recent weeks, it is clear that the deregulation of the finance industry in 1988 went too far. This is accompanied by pressurised advertising containing questionable assertions."
From 2006-2007, Citizens Advice dealt with more than 54,000 debt related enquiries.
Scott Kennerley, a Citizens Advice research and training development officer, said there is a concern the level of debt will increase across the province.
"When interest rates rise people stretch themselves to the limit and what was affordable slips into the unaffordable.
"Other payments start slipping and people start to struggle and what I think what we start to see is a steady rise in people defaulting on agreements."
For help and advice about debt log onto www.citizensadvice.co.uk