UK Households Increasingly Turn to Borrowing to Pay Everyday Bills

A growing number of UK consumers are turning to borrowing and credit to keep up with regular bills, raising concerns about household financial resilience. Findings from Intrum’s European Consumer Payment Report suggest that many people are still meeting their commitments, but an increasing number are doing so with borrowed money.The report found that 72% of UK consumers had borrowed money or used credit to pay bills at least once during the previous six months, excluding mortgages. This is up from 51% in 2025 and above the European average of 56%. The UK recorded the highest level among the 20 countries included in the research.In this episode of Debt Matters, we look at what this sharp increase means for consumers, creditors and the UK debt collection sector.Bills are being paid, but pressure is growingAround 27% of UK consumers said they had paid at least one bill late during the previous 12 months, compared with 28% a year earlier.At the same time, 81% said they were confident they could afford everyday essentials, while 79% believed they could pay all of their bills each month. However, growing reliance on credit shows that some consumers may be keeping payments up to date only by taking on more debt.A household can appear stable while its underlying debt burden and vulnerability continue to increase. This suggests financial resilience may be becoming increasingly dependent on access to credit.Consumers are becoming more cautiousThree quarters of UK consumers said the economic environment had made them more nervous about making a major purchase, compared with 49% last year. Meanwhile, 64% said they were more cautious about taking financial risks, up from 50%.Consumers are also trying to build stronger financial buffers. Some 74% now put money aside each month for unexpected expenses, up from 59% in 2025, while 42% say they are prioritising saving over spending. At the same time, more households are cautious about large purchases even as credit is increasingly used to manage everyday cash flow.Flexible credit and AI are changing money managementAcross Europe, four in ten consumers used buy now, pay later services during the past year. For financially resilient users it may mainly be about convenience, while more financially fragile consumers can use it to manage cash flow or buy essentials.The report also found that 44% of UK consumers use AI tools for personal finance. Some 52% said they would be comfortable using an AI assistant to resolve a payment issue or arrange a payment plan.What does this mean for debt collection?For creditors and collections teams, the key question is whether a customer’s payments are sustainable.If consumers increasingly use borrowing to meet financial obligations, creditors may need to identify vulnerability earlier. Realistic repayment plans, appropriate communication and access to human support could become more important.In this episode of Debt Matters, we discuss:• Why borrowing to pay household bills has increased so sharply. • Why stable late-payment figures may hide deeper financial difficulties. • How reliance on credit could affect future arrears. • The role of BNPL and flexible payment options. • Why early engagement between consumers and creditors matters. • How AI could support payment arrangements while retaining human assistance.#DebtMatters #DebtCollection #UKDebt #ConsumerDebt #HouseholdBills #CostOfLiving #Borrowing #ConsumerCredit #Arrears #DebtRecovery