I got a loan to help me pay for my dad's funeral. The interest sent me spiralling into debt

When Charlotte Liddell’s dad died, she was devastated. Just two days later, she got the bill.

“I had no understanding of how much a funeral would cost, at all,” the mum-of-two told Big Issue. “Not even a rough estimate. So to have that sudden cost, that was so so stressful.” 

Liddell had just 24 hours to come up with £1,518. The then-25 year old had £450 in the bank, savings she’d hoped to use to buy her first car. Liddell’s younger brother contributed everything he had – some £68 – but they were still a grand short. She “knew she’d have to get a loan”. 

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“But my credit score wasn’t good,” Lidell explained. “I was very limited in what I could apply for. I applied for as much as I could, and I couldn’t even consider the interest. The second it said ‘accepted’, I had to take it, I had 12 hours at that point to pay the funeral place.”

It would take Liddell years to pay off the loan, which had an APR (annual percentage rate) of 40%. The monthly fee served as a constant reminder of one of the most upsetting periods in her family’s lives. 

“It took a toll on my finances, but more mentally. It felt like a punishment,” she said. “I was having to pay this company so much interest, because they helped me when dad died.”

The Scottish mum is sharing her story as part of a powerful new project. The Poverty Alliance and Fair By Design gave cameras to 15 people on low incomes. The participants – all of whom were denied access to credit during times of urgent need – took photos of their daily lives.

An empty fridge; a frozen window; a homeward-bound plane soaring far out of reach. The gallery shines a light on what happens when people are “locked out of affordable credit”, says Isla McIntosh, senior communities and networks officer at The Poverty Alliance.

“People in the UK want to live in a just and equitable society. But far too many people are struggling under a tidal wave of rising costs, with no access to credit that could help them keep their heads above water.”

Liddell’s story is far from uncommon. Recent research from the Money and Pensions Service found that 25% of Brits – some 11.5 million people – have less than £100 in savings, with one in six having nothing at all. Without a safety net, any unexpected expense can pull the rug out from under you. 

This precarity forces people into impossible situations: in the last three years, more than three million people in Great Britain have borrowed from an illegal moneylender. More still took out legal – but extortionate – payday loans. 

Liddell had always budgeted carefully. A teenage carer for her two younger siblings, she worked long night shifts at a care home to make things work. A dedicated volunteer at charity Fife Gingerbread, she won the organisation’s 2016 Young Parent of the Year award and the 2017 Young Volunteer of the Year Award.

But the Fife local was bankrupted by financial abuse at 19, when her then-partner took out a series of phone contracts and loans in her name. It destroyed her credit score.

“People maybe think you get payday loans for fun,” she said. “But I’d say for most people, it’s because you have no other choice. There’s nothing else that you can do.”

“I guess the best analogy I can think of is, if you’re sitting there needing blood and a doctor is like, ‘I can give you this bag of blood, but it’ll cost you a hundred pounds.’ If someone is standing right in front of you, and they’re dangling the thing that helps – 

“You’ll go to the bank. If you’re bleeding out on the table, you’ve got no choice.”

Fair4All Finance estimates the value of unmet demand for affordable credit today to be around £2 billion. This represents the gap between what people would like to borrow but can’t because financial institutions aren’t prepared to lend. 

People often need to borrow money for reasons that are beyond their control, said Maria Booker, head of policy at Fair By Design. Booker was project lead on the photography project.

“Most of us will experience a financial shock at some point – like a broken boiler or sudden loss of income. For those without savings, affordable credit can be the difference between staying afloat and spiralling into debt.”

Project participant Beth – not her real name – took a photograph of her hands tied to a steering wheel.

The mother-of-two taught full-time for 25 years, but had to stop work after she was diagnosed with cancer.  

“My teaching income wasn’t lavish, but it was enough to do ‘normal’ things like replacing a vehicle through car finance, when necessary. That all changed,” she told Big Issue. 

Beth and her husband have two children, both of whom have autism. The family are “solely reliant” on the car to get to all of their medical appointments and therapy sessions.” But the vehicle failed its MOT. 

“We knew we had to replace it, but we couldn’t get a loan,” Beth continued. “We just felt trapped, completely trapped.”

Like Liddell, Beth never expected to be in this position. Anyone can end up needing a loan, she added – but access to low-interest credit is highly limited. 

“There’s a lot of stigma,” she said. “The everyday person can work hard and cobble together enough to make a life, and to keep things going. But your circumstances can change. Everything can change.”

“I remember a moment frozen in time when I was sick – realising that we would have to go to a food bank. I remember the mortification of that. I’m ashamed to say it, but I remember that someone I used to teach with was volunteering in the food bank, and I didn’t want her to see me.” 

In an ideal world, no one would ever be driven to borrowing. But Fair By Design is calling on the government to provide more options for people on low incomes. Between 2022 and 2024 the group ran a No Interest Loan Scheme pilot, testing the impact of lending small interest-free sums to people who would not qualify for a commercial loan.  

The pilot was run by seven lenders across Great Britain, with more than £7.9 million lent across 14,000 loans. A full evaluation will take place in 2026, with the aim of rolling the scheme out more widely if successful. 

Safeguarding access to affordable credit can help turn the tide on endemic poverty, said Poverty Alliance’s Mcintosh. The current financial system “penalises the most vulnerable”. 

“[These photos] make it clear to financial and political leaders that we urgently need a more just and compassionate system, with fair banking and fair access to credit for all.”

For Liddell, it’s personal. She doesn’t want anyone else to go through what she went through when her dad died – the “horror and stress” of being forced to take an expensive loan. 

“I would like to do a tribute to my dad. When people pass away, they don’t want to leave their family in debt,” she said. 

“I want to advocate to help make things better for other people, and if he had not passed away I wouldn’t be doing that. I hope he would have wanted that.”

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