Rising debt a problem for BAME population, says study

PEOPLE FROM black, Asian and other minority ethnic communities are particularly at risk of financial problems and rising debt caused by the Covid- 19 economic crisis, according to a think tank.

The IPPR said people from black, Asian and other minority ethnic ( BAME) communities were particularly likely to face financial difficulties even before the pandemic.

Some 12 to 18 per cent reported struggling with money, compared with seven per cent across the general population.

Among borrowers, those from black communities also had particularly high relative debt levels compared with their income, at an average equivalent to 18 per cent of their annual gross earnings, compared with 12 per cent across all groups, the research found.

Looking at people from all minority ethnic groups who were employed or self employed at the start of the year, 13 per cent were no longer working in June, compared with five per cent of the group generally, the report found.

People from minority ethnic communities are also particularly likely to be renters and will not have had the benefit of mortgage payment holidays that home owners have, it added.

Shreya Nanda, an author of the report, said: “Without further intervention we are on course for a new debt crisis from which black, Asian and other minority ethnic people are particularly at risk.

“Many in these communities are likely to experience financial difficulty in the months ahead and be vulnerable to eviction as a result of rent arrears.

“Such economic insecurity risks compounding the already disproportionate health impacts borne by people with minority ethnic backgrounds during this crisis – effectively a double whammy.”

Anna Round, who is also working on the project and was a co- author, said: “We are now undertaking further research that will enable policymakers to gauge what kind of interventions would best protect these groups.”