New research into County Court Judgment (CCJ) trends has found that the number of debt judgments has increased by 35 per cent year-on-year.
The study published by the Registry Trust has highlighted the issue of consumer debt in the UK, which is being driven by a squeeze on wages and historically low interest rates.
CCJ debt judgments are handed out by the courts to individuals and businesses that are unable to repay debts.
More than 30,000 of these orders were received by business and individuals during the first quarter of 2017, bucking previous quarter’s trends that saw a decline in CCJs.
This growth potentially represents an 83 per cent rise in the number of judgments registered against UK companies, according to the Registry Trust.
Commenting on the worrying trend, Joanna Elson, Chief Executive of the Money Advice Trust (MAT), said: “It is worrying that the number of CCJs issued has been increasing so dramatically.
“The sharp spike in the first quarter follows a general increase we’ve seen in recent years and is likely due to a number of factors including an overhang from the financial crash with debts coming to the end of the period in which creditors can take action, more people now struggling to balance household budgets, and a change in approach by some collection agencies.”
She warned: “There’s a strong chance that this trend will continue as people feel rising inflation levels eating into their wages.”