Concerns have been raised that people are turning to loan sharks as credit becomes more difficult to come by.

Francis Walker, a representative for Credit Action, has highlighted the problem of people seeking types of high-interest borrowing such as payday loans in the absence of more conventional forms.

"Even pawn brokers are supposed to be more successful at the moment because people have difficulties, particularly the less well off," she revealed.

Ms Walker expressed her sympathy for those in such situations and said she understood why people "desperate" for money would go to such measures, but she warned borrowers that it can be "very expensive".

Those struggling with money matters should seek the help of credit unions, she recommended.

Recent research from Abbey Credit Cards showed that disposable income has dropped by around 30 per cent over the past two years.

One in ten Brits are spending 90 per cent of their salaries on basics such as rent and bills, it found.

Source: moneyexpert.com