Although an expensive way to borrow, the current squeeze on lenders due to the credit crunch has resulted in a massive increase in the amount owed on overdrafts. Last May, borrowers owed £10.2 billion and while this amount had decreased by £1 billion by February this year, March saw an increase in borrowing of £217 million in just one month, bringing the debt back up again to £9.6 billion.

It is thought the figures reflect the fact that lenders currently only lend to those with a perfect credit score, leaving many unable to access personal finance products such as certain credit card deals and personal loans. This means more and more people are turning to their banks to help them out with credit and are more likely to be approved as the bank has access to their monthly financial details.