End Child Poverty calls for action as rent-to-own poverty premium leaves families paying up to three times as much for household essentials

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Rent-to-own poverty premium leaves families paying up to three times as much for household essentials

New research from the End Child Poverty coalition has found that families using rent-to-own are paying as much as three times as much for key household items, with little alternative to shop elsewhere if they are unable to pay upfront. An online price comparison found that families could face paying as much as £9,150 over three years for a set of ten consumer items (including a tv, sofa and washing machine), where similar items paid for upfront, could cost as little as £3,050.

The coalition is warning that many families who aren’t able to afford to pay up front for household goods and appliances, and who cannot access lower cost credit, often find themselves with little alternative but paying more by turning to a rent-to-own company.

Responding to a survey conducted for the report, more than 70% of StepChange clients said that they used rent-to-own as they could not afford to pay for the product outright, and nearly a third thought they wouldn’t be able to access the products elsewhere.

The coalition is warning that the collapse of the availability of interest free credit through the Government’s Social Fund may be a significant factor contributing to families having to use high cost credit to pay for household essentials  – in 2010 nearly £800 million per year was available for families needing  help, compared to little more than £400 million in 2017.

The End Child Poverty coalition is calling for tighter regulation to ensure that the prices charged by rent-to-own providers are reasonable, and for better access to interest free credit from the Government to help low income families purchase household goods and appliances without having to resort to high cost credit. The coalition is also warning that a squeeze on living standards as a result of the four year benefit freeze is leaving many struggling.

Sam Royston, Chair of End Child Poverty said:

“Faced with little alternative, many families turn to expensive rent-to-own suppliers in order to purchase items they cannot afford upfront.  This means that too many of those on a low income pay the highest prices for household items that they can least afford. 

“Tighter regulation of the rent-to-own sector, combined with better access to interest free credit for low income families, is needed in order to address the hefty “poverty premium” faced by too many families buying on credit.”



  • You can get in contact with the coalition by emailing Judith Cavanagh, End Child Poverty Coalition Coordinator, at judith@endchildpoverty.org.uk or on 07918 567577


Notes to editors:

  • The End Child Poverty coalition (endchildpoverty.org.uk) is made up of around 100 organisations from civic society including children’s charities, child welfare organisations, social justice groups, faith groups, trade unions and others, united in our vision of a UK free of child poverty. These include Child Poverty Action Group, The Children’s Society, Barnardo’s, Gingerbread, Oxfam, Action for Children, TUC, Save the Children, and the National Children’s Bureau.
  • The report can be downloaded at endchildpoverty.org.uk
  • Download campaign summary
  • This report draws on analysis of three main data sources:
  1. StepChange client survey: A survey of a small sample (89) of StepChange Debt Charity clients who have used rent-to-own to purchase household items was undertaken in August – September 2017. The responses from this survey were used to provide qualitative and some indicative quantitative evidence on the experiences of those who use rent-to-own and what alternatives they had available to them.
  2. Online price comparison: We conducted an online comparison of example rent-to-own prices, with prices of purchasing comparable items up front from the cheapest available alternative retailer. This comparison looked at the overall cost of the item, including any delivery and installation costs, and costs of interest over the payment period.
  3. Analysis of interest-free credit availability from the State: The final piece of analysis looked at the availability of interest-free credit from the State between 2010 and 2016. This was done through analysis of the annual report on the Discretionary Social Fund.
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