Lenders tighten criteria

Loan providers have tightened lending criteria due to the recent credit crunch, according to one debt expert.

Chris Tapp, director of Credit Action, explained that an increased number of Britons are at risk of debt following the recent credit crunch and banks are starting to introduce stricter rules for loans.

He explained that the festive season has not really had an impact on lending, as loan providers are more focused on the recent credit crunch.

"About half of people now applying for personal loans are being turned down. More people are also being refused for credit cards," Mr Tapp said.

He added that rates and charges have also increased, making it more expensive for borrowers to take out loans and mortgages.

Mr Tapp was speaking after research from Cornhill Direct revealed that a third of consumers fall into debt each Christmas.