HOUSEHOLDS are resorting to illegal moneylenders to pay their bills and buy everyday essentials, new research revealed today.

The study on households in energy debt by the Warm This Winter campaign found that almost one in five have been forced to turn to illegal moneylenders in the last 12 months. 

It revealed that reliance on these sources increased among younger households, with a quarter (24 per cent) of under 35s and a third (32 per cent) of customers aged 35-44 turning to illegal lenders.

Researchers predict that the mountain of illegal debt is set to increase again over the next 12 months as two-thirds of households in energy debt look for alternative ways of making ends meet.

It estimated that 14 per cent will seek out illegal moneylenders, 27 per cent will turn to credit cards, and 20 per cent will borrow from family.

The research was shared today with the House of Commons energy security and net zero committee.

End Fuel Poverty Coalition co-ordinator Simon Francis said: “Energy debt is forcing households to wake up in the morning scared of the consequences of using electricity or gas.

“We need to see more insulation, ventilation, unblocked cheaper renewables and weaning ourselves off oil and gas to improve energy security.”

The committee heard that Time of Use tariffs, which encourage consumers to use electricity at times when more is available cheaply, risk disadvantaging millions.

Veronica Hawking, from 38 Degrees, said this included those “who rely on energy for medical needs, who need to leave the house at a regular time of day, or who can’t access a smart meter.”