Women in Debt, which offers female-focused debt advice, has warned that the number of UK women facing serious debt has grown significantly over recent years.

The organisation believes that more women will need advice on solving debt problems in the future because they are building up an unsustainable level of indebtedness.

Women in Debt’s director, Georgina Earle, said: “Females have fought for equality over the last decade or so … We have wanted independence from our spouses and to be able to afford a lifestyle based on this equality.”

However, in their efforts to achieve equality, many women have taken on debts they can’t afford, she warns, and the economic decline in recent years has made the situation worse.

“More females have been able to secure credit based on better jobs [and] higher salaries … However the past few years have seen a huge change and I believe that women will fare the worst,” Ms Earle said.

Labour MP and anti-debt campaigner Stella Creasy recently warned that women are being targeted by payday loan companies.

There has been a rapid increase in the number of payday lenders operating in the UK in recent years as household incomes have been squeezed by the recession.

Payday loan companies offer instant loans of small amounts for a short period, typically around a month.

If the loan is paid off in full at the end of the term there usually isn’t a problem, but rolling over a loan to the following month can quickly cause difficulties because of the extremely high interest rates charged by payday lenders.

Payday loan companies have set up websites targeting women and are advertising on television programmes such as Glee and Friends.

Ms Creasy said women are being taken in by payday lenders.

“Because they are working and have a regular income they are able to pay back at least some of the loan. But if they can’t make a payment they make money for the firm through paying penalties and extensions,” she commented.

At the end of last year accountancy firm RSM Tenon reported that women account for nearly half of all insolvencies, while in the 1980s it was very rare for women to become bankrupt.

National money education charity Credit Action today revealed that one person is declared insolvent or bankrupt every 60 seconds during the working week.

Based on statistics gathered in the third quarter of 2011, the charity estimates that 331 people are made insolvent or bankrupt every working day and 101 properties are repossessed every day.

The current high level of unemployment is a major factor in tipping people into debt and between August and October 2011 1,764 people a day were made redundant.

The average household debt in November, excluding mortgages, fell slightly to £7,982 in November from £7,995 in October.

When mortgages are included, the average household debt increased slightly to £55,816 in November compared with £55,815 in October.

For the UK as a whole, personal debt totalled £1.451 trillion at the end of November 2011, with £173 million being paid daily in interest alone.

Michelle Highman, Credit Action’s chief executive, advised people experiencing financial difficulties to seek free advice from Citizens Advice or the Consumer Credit Counselling Service.

Last month the Insolvency Service reported a worrying trend for record numbers of young people to become insolvent.

Young people are increasingly turning to Debt Relief Orders, a type of insolvency only introduced in 2009, which wipes out debts after a year unless there has been a change in personal circumstances.

There is a fee of £90 and no need to go to court but although this seems like a quick and cheap solution, the holder of a Debt Relief Order will be unlikely to be able to secure a mortgage, credit card or loan for six years.

Debt Relief Orders are only available to people with debts of less than £15,000, who don’t own their own home and have less than £300 in savings or other assets.

Although people who have been made bankrupt are legally allowed to hold a bank account, in practice most banks refuse to allow an undischarged bankrupt to open one.

This reluctance is because of the risk that a trustee could pursue the bank for loss of money following a bankruptcy.

However, the lack of a back account can make life very difficult when it comes to paying bills, receiving wages and managing finances generally, while being forced to use cash can result in additional expenses being incurred.

In July last year Citizens Advice published a report suggesting that the current situation was causing undischarged bankrupts undue hardship.

The Insolvency Service has therefore launched a 12-week consultation into improving financial access for undischarged bankrupts.

It is considering a number of options, including establishing a voluntary code for banks to agree to give bankrupts access to basic bank accounts, and developing guidelines for trustees in bankruptcy.

If non-statutory measures prove ineffective the Government may legislate on the issue.

There are currently just two high street banks which allow undischarged
bankrupts to open basic accounts.

Business Minister Edward Davey said: “Access to a bank account is an essential stepping stone to help people manage their finances and to get them back on track after facing up to their financial difficulties.

“Without access to a bank account, even the simplest financial transaction is beyond reach for an undischarged bankrupt.

“What I want to see are financially capable consumers who are able to effectively manage their money, and make the fresh start they need.”

The latest figures from the Government’s Insolvency Service show that the number of people declaring themselves bankrupt has fallen 31 per cent year on year.

One of the factors in this fall is believed to be the high cost of declaring bankruptcy.

It costs £700 for an individual to declare themselves bankrupt and this has to be paid to the court immediately, although the cost can be reduced to £525 for people on low incomes.