Once upon a time ago it used to be the Yanks who led the way in buy now pay tomorrow. Everything was bought on credit, even if you were loaded and could afford to buy things outright. Even further up the scale it was also a sign of standing of how much credit you could get.

The same credit culture that griped the States has undoubtedly had its claws in the UK now for some time. Buy now and pay later, it seems, is just too irresistible for many people. But how culpable were the banks in leading to the situation where millions of Brits now find themselves in debt?

At the heart of it, from a purely cynical angle, is how easily banks were willing to lend vast sums of money in personal loans, which effectively tied people in long term repayments. Of course they should be personal responsibility but in the face of the sometimes constant bombarding of readily available cash loans has proved to be hard to refuse.

Now, I am not saying that all banks that offer loans are like the anti Christ, although obviously a few of the them are, because some of them do help people in the short term to say get a car for a new job, get start up money for a business, or to fund a training course. Essentially what’s considered worthwhile or reasonable reasons to borrow money. But what is a bit sad and depressing are the countless people who have saddled themselves up with debt for stuff that they did not need or to fund a lifestyle they could not really afford.

The banks were implicit in the situation today by making it too easy to borrow money. ‘But it’s not in our interest to lend money we do not get back’ is a typical response from the banks. But why do banks write off millions every year in unpaid debts and credit card fraud? Because it was all funny money, that’s why. It was the weird and wonderful world of financial institutions who lent money to each other and then lent it to the other people. The financial loan sea was awash with cash running up every stream and river until one day banks stopped lending money freely to one another and to other people.     

Now the banks are looking to their government’s to bail them out of their current predicament. Northern Rock was nationalised in the UK and Bear Stearns went for a song in the US.

The latest saw the Bank of England making it known it would make a further £5 billion available as panic caused interbank lending virtually to dry up. No sooner was the offer made, the bank was deluged with requests for almost five times that amount, with demands totalling £23.6 billion.