We lose a staggering £40 a year from unpaid loans to friends and family, equating to £2,500 in a lifetime according to new research released by Nationwide Paym.
Asking a relative or friend to repay money is often an awkward experience and over two thirds (73%) of Brits don’t trust all of their friends and colleagues to pay their way fairly during group events.
The research of 2,000 UK adults was conducted to discover how we split bills during social activities and attitudes towards borrowing and lending money. A fifth (21%) claim they have ended up paying more than their share because it’s socially awkward to pay separately and 20% have missed out on getting their fair share due to buying rounds.
So, how small an amount is acceptable to ask a friend or colleague for? On average, the smallest amount people would feel comfortable chasing is £4, with over 80% starting to chase before the debt reaches £6. The main reasons for not repaying borrowed money is that they simply forgot (47%), they didn’t have the cash on them at the time (34%) and not having the relevant payment details to transfer (12%).
Head of Payments at Nationwide Building Society, Paul Horlock said: “It is shocking that we are collectively losing this amount of money from lending to friends and family or from splitting the bill when sharing lunch. We can be just too embarrassed or often don’t have money on us to pay back those small debts, it is very socially awkward.”
With advances in online and mobile banking, a mobile number is now enough information to send and receive money securely, to and from friends and family – potentially saving Brits time, money and the effort of chasing down borrowed money, or sparing them the embarrassment of forgetting to repay.
Paul added: “The good thing about Nationwide’s Paym app is that you can exchange money with your mobile phone number – you don’t have to give out your bank details, go to an ATM or write a cheque. This can really help situations such as group meals when not everyone has cash on them and people want to pay by alternate methods. It makes it so much easier to settle those small debts, whilst also ensuring that everyone has the right amount.”