A quarter of young and middle-aged adults say their personal debt to the highest it’s ever been. Moreover, Brits are tied with Germans as the most likely in Europe to expect their financial situation to worsen in the next 12 months
A fifth (20%) of young and middle-aged Brits now rely on borrowing money to get by. The data is released by digital transformation services provider, CRIF.
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The firm analysed consumer sentiment across major European markets, including Austria, France, Germany, Italy, Spain and the UK.
CRIF reports that one in four (23%) Europeans say the cost-of-living crisis has increased their debt levels to record levels. In the UK specifically, similar proportions of young (18-34) and middle-aged adults (35-54) said their level of personal debt was higher than ever (26% and 23% respectively).
As a result, half (49%) of all Brits say the crisis has made managing their income and spending more challenging. This is slightly above the European average of 46%. Nearly a third (30%) now expect their financial situation to worsen in the next 12 months.
The squeeze has led to significant changes in the UK and Europe in how people look to manage their money. While one in five people (19%) in other European markets (Austria, France, Germany, Italy, and Spain) have reverted to greater cash usage to budget, the UK is the lowest of all countries surveyed when it comes to cash usage during the cost-of-living crisis (12%).
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By GlobalDataYoung Brits increasingly willing to share financial data
However, particularly among young adults, Europe has seen significant adoption of digital banking services to better manage their finances. And these shifting trends are likely to continue beyond the current crisis. More than half (56%) of young adults in Europe said they would now manage their finances online or through an app more than they previously did.
Crucially, more than four in ten (45%) young Brits would be happy to share more of their financial data.
The findings show shifting attitudes towards sharing personal financial data when the benefits of doing so are clearly communicated. And it underlines the growing importance of robust digital services for banks in the UK and Europe.
Sara Costantini, Regional Director for the UK & Ireland at CRIF said: “Across Europe, the rising cost of living is having a severe impact on people’s personal finances.
“With many facing higher levels of debt than they’ve ever experienced before, Europeans are embracing innovations in digital banking to better understand and manage their finances, with younger adults in the UK among those leading the way.
“This shift isn’t just a flash in the pan. The adoption of digital services is set to endure beyond the current crisis. If banks and lenders want to remain competitive, they need to ensure that their own digital services provide people with the insights, analysis and level of service they’ve come to expect.”
