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Unscrupulous credit card firms are pushing thousands of pounds worth of extra credit onto millions of people who can’t afford to pay, a debt charity has warned.

Six million people had the credit limited increased on their card last year - yet they didn’t ask for an increase.

Citizens Advice figures show card companies are lending too freely and putting individuals at risk as a third of people already struggling financially were given higher credit limits.

Over the past year 8.4million card holders had credit limits increased, but just one in four actually asked for it.

Average increases were £1,481 and one in ten were £3,000 or more.

Dawn, 53 knows the financial heartache unsolicited credit limit increases can cause. She has ended up in a debt spiral unable to pay her credit card bill.

(Image: Getty)

Dawn, from Blackburn in Lancashire, has arthritis in her back and had to give up work. She relies on employment and support allowance. She was approached on the street and offered a credit card with a £500 limit.

She had never had a card and didn’t want to turn the offer down as the people were really kind to her. Before she had reached the £500 credit limit it was extended to £1,000. Then without any requests from Dawn it rose to £3,500.

Dawn said: “It was all good at first but the more I spent the more the interest went up and the higher the repayments. I used the card for unexpected bills such as a big vet bill for my cat. Then I spent too much on it over Christmas.

“It’s too easy to spend on plastic, it’s not like handing over cash. I kept thinking I’ll get on top of it in the New Year. But then it was too late.”

Dawn was paying her credit card bill, just the minimum repayment each month, then having to use the card for essential bills as she had no money left.

(Image: Getty)

“I’ve been a fool and now can’t afford the repayments. I know it’s partly my fault but I didn’t really understand how credit cards worked. When you are struggling on a low income and someone offers you credit you will use it when you’re desperate.

“I spend all of my time worrying about this. I’m scared to open letters or answer phone calls and haven’t had a proper night’s sleep for months.”

Citizens Advice wants the Chancellor to announce a ban on unsolicited credit limit increases in his Budget statement next week, to protect vulnerable people like Dawn.

Gillian Guy, chief executive of Citizens Advice, said: “It’s clear that credit card companies are contributing to the rise in consumer debt.

“Rather than credit card holders seeking to take on more debts, lenders are actively pushing it on people without enough consideration as to who can afford to pay and who can’t.”

City watchdog, the Financial Conduct Authority has carried out a study into the credit card market and proposed new rules. These include greater control over credit limits.

(Image: Getty)

The FCA wants new credit card customers to be given the choice on whether to make firms obtain consent for each unsolicited credit increase. And it wants existing card holders to have a straightforward way to decline increases or choose how they will be offered in future.

Richard Koch, Head of Cards at UK Finance said: “Credit card providers are completely committed to responsible lending and the industry has come together to voluntarily agree new protocols to ask customers whether they would prefer to opt-out or opt-in for any credit limit increase offers.

“Furthermore, the customers who the Financial Conduct Authority and Citizens Advice are most concerned about will be excluded from receiving any such offers.

“The regulator has confirmed that it is satisfied that the proposal relating to unsolicited credit limit increases achieves its objectives in an effective and timely manner.”