Catholic groups such as Justice and Peace Scotland and Caritas Westminster are warning about a “timebomb of debt” among poorer households in UK.
The term was used by the Joseph Rowntree Foundation last week as interest rate rises hit low-income households.
Millions of families are borrowing to cover basic bills and expenses, say activists who warn that Britain is entering a dangerous new phase of the cost of living crisis.
According to Joseph Rowntree Foundation, 2.3 million low-income families have reported taking out loans or using credit to pay essential bills during the crisis.
Manchester-based ecumenical charity Christians Against Poverty (CAP) has warned that 9.3 million people are facing problem debt and are in need of debt advice.
For carers, people with disabilities and renters, poverty rates are much higher, and the same is true for people of ethnic minorities.
Two-thirds of CAP clients report having fallen behind with one or more household bills and there is a rise in buy-now-pay-later purchases. A recent report by CAP documented 874 churches being involved in delivering help through 281 debt centres, 92 job clubs and 134 life skills groups.
Caritas Westminster is running an online training on loan shark awareness on 14 Sept. It is designed to help participants understand what a loan shark is, help to spot signs that somebody is a victim of a loan shark and how to help them.
Caritas Shrewsbury has lobbied for increasing family income by supporting the campaign to abolish two-child limit on benefits.
The limit restricts means-tested benefits to the first two children in a family if they were born after April 2017. The Child Poverty Action Group, which provides a debt advice handbook, reports that around 50,000 children every year across the UK are pushed into poverty as a result of the two-child limit and a further 150,000 children who are already living in poverty can expect to see their circumstances deteriorate further. In Scotland, Christians Against Poverty has a network of debt centres across Scotland. The team in its Edinburgh Office offers help on dealing with debt, help to improve finances and budgeting.
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