Many individuals through out the world are burdened with debt beyond their means to repay. Many live fear being disconnected from services like gas and electricity, being evicted from their homes for being behind on rent or mortgages or having household goods repossessed. Many debtors are neither feckless nor wilful but find themselves with low incomes and a sudden problem like unemployment, crop failure, divorce, illness or death.
It was found in the USA that there was a 23% average increase in consumer spending when credit cards are used instead of cash.
In the 1990s, one in ten consumers in the UK faces difficulties paying debts and more two million have borrowed more than they can afford to repay. In the US, consumer instalment-credit outstanding (which excludes borrowing for house purchase) more than doubled in the 1980's, from $300 billion to $660 billion. Credit card debt was $50 billion in 1981. By January 1989, it had risen to $180 billion.
In the USA in 1990, 83% of disposable income was spent on personal debt payments compared with 62% in 1983. There was a 140% increase in consumer debt in the 1980s. The average American in 1990 carried $8,570 of non-mortgage personal debt. One family in sixty-eight filed for bankruptcy in 1998; at the same time Congress has proposed legislation that would make it much harder for consumers to erase their debt by declaring bankruptcy.