London: capital of debt

posted by in Budgeting

London's Trafalgar square

London: home of debt (photo: Luciano Mortula /

Popular opinion of London isn’t favourable: it’s portrayed as a fat cat city, spending large while the rest of the country suffers from a recession. But this hides a surprising truth: London is actually the most over-indebted region of the country.

Think about the residents of west London borough of Kensington and Chelsea and what comes to mind? It’s unlikely to be an area with the highest debt repayment burden in the capital. Or how about the borough of Hammersmith and Fulham? No one would think of it as one of London’s rent arrears hotspots.

Research on London debt

Recently we commissioned research that identified London as the most over-indebted region in Great Britain (PDF). We’ve released a London debt infographic today to accompany the publication of it (you can click on the image below to see it full size).

london debt graphic

London debt – click to see the full-sized version

The research found that this debt pain is not evenly spread, with those living in some boroughs much more likely in the red than others. The city contains – as it always has – a vast collection of people, from those considered by some as obscenely wealthy to those suffering from the highest rates of poverty seen countrywide.

The research highlighted the areas that are traditionally seen as the poor neighbours of the swanky boroughs of west London – it might come as little surprise that Tower Hamlets, Haringey, Brent and Barnet are London’s other rent arrears hotspots.

Debt south of the river

Looking south of the river we find Sutton and Croydon, the two areas most in need of debt help. 40 in every 10,000 residents of these two boroughs contacted us for debt help in 2011.

Conversely, less than five miles north, straddling the river, lies the borough of Richmond-upon-Thames. That exclusive part of west London had the lowest demand for debt help in 2011 – 40 times fewer people living there contacted us than in Sutton and Croydon.

Also south of the Thames, the highest proportion of payday loan borrowing among our clients came from residents of Lewisham, Bromley and Lambeth.

Debt help for London

This might not be too much of a surprise. Last year we wrote about the debt hotspots of Britain; rather than inner-city areas, the highest average personal debt occurs in those places regarded as the leafy suburbs of the London commuter belt – Slough, Watford, Sutton, Kingston upon Thames and Guilford.

We should all remember that while poverty and debt is linked, you can have debt without poverty. If you find yourself in this situation please read some of our other MoneyAware blogposts to understand what you can do, and when you need to contact us.

London’s image problem

London has an image problem in the eyes of the rest of the country that isn’t going to change for years to come. However we mustn’t forget that within London there are areas – rich and poor – where personal debt is endemic. In the end London residents have the same debt problems as anywhere else in the UK, despite the myths.

If you need debt help, don’t let your capital become a pain. Use our online counselling service Debt Remedy now or contact us on 0800 138 1111 (Free from all landlines and mobiles.)

Peer's the digital content manager at StepChange Debt Charity. Apart from contributing to the MoneyAware blog and overseeing the charity's website and social media content, he’s walked to the top of every mountain and hill in the Lake District. Twice.

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