Consumer protection and household indebtedness

Over-indebtedness generally arises following an unexpected drop in income, related in particular to a job loss, illness, separation or even over‑consumption

Situations of over-indebtedness can no longer be seen as the problem of an individual as a result of their compulsions and passions. Today, they reflect a social and societal crisis

According to a survey by the European Central Bank, over-indebtedness generally arises following an unexpected drop in income, related in particular to a job loss, illness, separation or evenover‑consumption.

It is currently giving greater cause for concern, as it is hitting poor workers, the unemployed, who have accumulated unpaid bills for essential services such as energy, water, insurance and the telephone and late rent payments, middle class people, often following a twist of fate, and also pensioners whose pensions have fallen because of austerity policies or who give financial support to their family.

The risk of over-indebtedness is heightened by the imbalance between the rise of income and the rise in the cost of living, which is linked to changing lifestyles, national austerity policies, rising everyday expenses such as energy, housing, electronic communications, telephone, transport and financial costs.

The recent rise in over-indebtedness encompasses another sociological category: middle class people who have lost their job and are faced with heavy mortgage payments on their home, with no short-term prospect of finding another job.

Taking out loans in an affluent society, encouraged by aggressive, misleading advertising campaigns, to make up for loss of income or obtain goods and services, is also at the root of over-indebtedness in numerous cases.

Vulnerable population groups are worse affected by debt as they do not have access to all forms of credit owing to their poor creditworthiness.

They are directed towards the most costly options, such as “cash credit”, which often involve cards distributed by various operators with very high interest rates.

Read more about what over indebtedness is, measures to address it and prevent it including legal solutions and about assistance facilities for over-indebted people.