Bank of Friends used by cash strapped mates during the recession according to Post Office

Financial News

Friends borrowed cash from each other during the recession.

Money was exchanged between friends to cover costs during the economic downturn.

Over a quarter of adults have lent an estimated £133 to an average of four friends in the past year, according to Post Office research.

The survey found that the effects of the recession have meant that a new type of lending between friends has emerged, under what the postal company has labelled as the ‘Bank of Friends’.

However, 18% of those polled had lent more than they could afford and 19% can’t remember how much they lent out in the first place. One in ten people said they did not need the cash back.

Doug Strachan, Director of Financial Services at the Post Office, said: “Understandably, millions of households across the UK have needed to tighten their purse strings as the recession has taken its toll, and with money hard to come by from many lenders, people can be thankful that they have such good friends they can rely on”.

He continued: “Not only does this research show another side effect caused by the recession, but it highlights how people want to help others, outside of their immediate families, through tough times. However, our survey did reveal that one in five people are lending more than they can afford, so the Post Office is urging people to make sure they don’t put themselves, or their household, into financial difficulty when helping others”.

Borrowers from the ‘Bank of Friends’ were found to pay back the borrowed sum through a selection of means. The top five alternatives to pay back the cash were to pay for alcohol, carry out a favour, offer a thank you kiss, cook a meal or give a thank you card.