People with disabilities have lower incomes, but their disabilities often come with extra costs. Because of this, two out of every five disabled people have to get loans or other forms of credit to pay for higher living costs on a lower-than-average income. Because of this, a lot of people are getting into "problem debts," which are often loans they can't pay back.
The Leonard Cheshire charity for people with disabilities is asking the UK government and the credit industry to help make this debt easier to handle. In a survey done by the charity, nine out of ten people said that they often ran out of money.
It also found that more than half of them didn't make enough money to cover their basic needs and made less than GBP10,000 a year. Many also found it almost impossible to switch jobs or careers in order to make more money or a better living.
Nearly 40% of the people surveyed were adding to their debt by taking out more loans. But most of them also said that lenders weren't very flexible when talking about payments and didn't seem to understand how their disability affected their daily lives.
Leonard Cheshire said, "Easy access to credit is part of the problem, but a lot of disabled people's debt comes from buying things they need." He added that this makes disabled people especially vulnerable to spiralling debt that they have no chance of paying off.
The report from the charity for people with disabilities also talked about how people's debt was affecting their health. It found that most people thought it was hurting their health and that 1 in 10 had thought about killing themselves because they were worried about money.
Problem debt is usually caused by spending too much on luxury items, but Leonard Cheshire said that disabled people borrow to cover just their living costs, which are often much higher than their incomes plus any benefits they might get.
Many disabled people have to pay extra money for things like electric wheelchairs, stair lifts, and other changes to their homes, such as extra heating costs and personal care that the NHS doesn't usually cover.
Leonard Cheshire wants the UK government and the credit industry to make a number of changes, such as:
- Showing on the loan statements how long it would take to pay off the loan with the minimum monthly payment
- Making responsible lending a law that all lenders have to follow
They want to talk to the lenders to convince them to forgive debts when a customer is registered as disabled.
- Lenders can't raise a customer's credit limit unless the customer asks them to do so.
The survey by the charity also found that having a lot of debt often made a disabled person feel even more alone.
Since so many disabled people already depend on benefits as their main source of income, the situation is not likely to change. It also shows how important it is for the government to look at the level of benefits for disabled people. If they can't live on the money that is given to them, then more money must be found.
