Millions of UK families using credit cards and loans to pay basic bills

Experts warn that struggling households are being targeted by firms offering individual voluntary agreements to clear debts. Photograph: Ben Birchall/PA

Millions of families are borrowing to cover basic bills and expenses, according to analysis that warns Britain is entering a dangerous new phase of the cost of living crisis.

Interest rates are expected to rise again this week and there are warnings about a “timebomb of debt” among poorer households. Reports suggest companies are targeting struggling single parents, using social media ads, to offer inappropriate debt repayment schemes that will leave them worse off.