55,000 people, or 7% of total mortgages, are now in arrears of 90 days or more, according to the Central Bank. Unfortunately, this situation is replicated in commercial lending where businesses are struggling with reduced demand and increased difficulty in getting paid. As a nation, never before have we been under as much financial pressure.

Debt arrears is a huge problem and unfortunately looks set to continue into the future. However, this problem is being exacerbated by the banks forcing people off interest-only repayment schedules (for both residential mortgages and commercial lending) and subsequently into arrears. Given the tens of billions of taxpayers’ money that we have pumped into the banks to rescue them, I find this situation completely unacceptable and morally wrong.

I have been approached by several constituents recently who the banks have attempted to force them off interest-only repayment schedules. Although in several cases, the term of the interest-only debt had lapsed, the banks were attempting to force a repayment of interest + principle upon people who were already struggling to only pay the interest portion. In most instances this equated to a doubling of their repayments, repayments which they could barely afford. Governing repayments simply by reference to contractual terms, with no eye to current repayment capacity makes no sense, financially or otherwise.

Given persistent unemployment in excess of 14%, public and private sector pay cuts, reduced domestic demand and the recent series of variable rate interest increases, the pressure on families and businesses is relentlessly mounting. As a nation we have rescued the banks. However, those same banks must now adhere to their part of the recapitalisation deal and they simply aren’t. Bank inflexibility, contractual dogmatism and a general lack of co-operation with people who are genuinely trying to meet their financial commitments is unacceptable. This type of sharp bank practice must stop.