Millions of people across the UK could significantly reduce their borrowing costs by using new debt consolidation technology, according to fresh research from Experian.
As households head into the Autumn Budget and prepare for the financial strain of the Christmas period, the findings warn that 83% of borrowers — around 34m people — are carrying revolving credit that is not optimised. This means most consumers are paying more interest than necessary, increasing financial pressure at a time when budgets are already tight.
Experian’s analysis shows that widespread use of advanced consolidation tools could generate an average saving of £1,257 a year per consumer. If adopted at scale, these efficiency gains could unlock £15.1bn in household spending and deliver a further £2.1bn in annual savings through reduced interest charges nationwide. The research also highlights how managing multiple credit lines raises the likelihood of missed payments and, for some borrowers, the risk of falling into a debt spiral.
Demand for consolidation support is already high, with debt consolidation emerging as the most common loan search on Experian’s Marketplace. To improve outcomes for consumers, Experian has incorporated ReFi™, a new debt consolidation technology, directly into its platform. Unlike traditional consolidation loans, ReFi™ calculates final settlement balances and automatically pays off existing debts with creditors. By ensuring lenders assess only the new loan — and avoiding the issue of double counting — the technology expands access to credit for customers who might otherwise be declined. According to the company, some lenders have reported a 68% rise in successful consolidation loan approvals since adopting ReFi™.
The financial impact for consumers is substantial, from lower monthly payments to reduced stress and improved creditworthiness. Experian estimates that broad adoption of ReFi™ could add more than £15bn to the UK economy by cutting unnecessary interest expenditure, while also helping households save £2.1bn annually.
Experian has also partnered with Fair4All Finance on a £1m initiative designed to widen access to affordable credit. The collaboration aims to help 10,000 borrowers in its initial rollout, potentially saving them more than £50m in interest.
Experian managing director of consumer services UK&I Edu Castro said, “We’re committed to helping people take control of their finances. Technologies like ReFi™ make it possible for millions to pay less interest, simplify repayments, and ease financial pressure. Our partnership with Fair4All Finance also strengthens this mission, enabling us to reach more people who need affordable credit and real support.”
Fair4All Finance CEO Kate Pender said, “We’re delighted to be working with Experian on their ReFi ™ technology and also with the lenders who use it to reach people in financially vulnerable circumstances. With millions of people financially excluded in the UK, fair and affordable credit is a vital safety net that many can’t access.
Debt consolidation lending in particular is a great solution for the cost of living crisis. It can reduce people’s monthly outgoings and also cut the amount of interest they have to pay overall. This direct settlement technology will ensure more people are able to access a consolidation loan, improve their creditworthiness and steer clear of problem debt.”
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