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Historian Reveals Spiralling Debt has Shaped Consumer Culture for Centuries

Originally published 8 January 2004

New Year sales and Christmas shopping sprees have a sting in the tail when credit card bills hit doormats in January, but new research from the University of Warwick shows that rather than being a modern phenomenon, debt and consumer credit dependency were rife in the 1800-1900s, and that formal and informal money-lending was integral to goods exchange.

In the 21st century a high number of financially overstretched individuals are at risk of plunging further into the spiral of debt, but Dr Margot Finn’s book The Character of Credit reveals this is nothing new. An investigation of eighteenth century English and Welsh gaols, found that debtors constituted half - and convicted felons only a quarter - of all prisoners. At least 5,333 debtors suffered imprisonment in 1769 and 8, 238 in 1778.

Credit relations were widespread in consumer markets, entangling family members, friends, neighbours and tradesmen in mutual obligation. Just as today’s store loyalty cards help secure customers, credit and connection secured customer loyalty in the 1800s, but often at the price of unpaid debts and deferred payments.

The diaries of painter Benjamin Robert Haydon (1786-1846) reveal debt as both a dangerous degrading source of obligation, and as an unavoidable part of economic exchange. Plagued by debts of several thousand pounds by the early 1820s, seven times arrested and four times imprisoned for his unpaid debts, Haydon was eventually driven to suicide in 1846 by financial ruin and manic depression.

Solvent and insolvent consumers enjoyed extended billing cycles and generous, flexible credit terms. Connection, the retail convention by which tradesmen extended long credit to middle and upper class consumers in return for loyalty, allowed Haydon to extract goods and loans from creditors he was already substantially in debt to.

Haydon’s landlord, Newton, was one such creditor, and repeatedly deferred rent collection. Gift exchange worked together with loans and cash payments to enmesh them in mutual obligations. As a token of these ties when Haydon’s son was born in 1835, he named the child Newton after his most sympathetic creditor.

Today, consumers often reach for the plastic when paying for Christmas presents, and many people feel under intense pressure to buy over the festive period. However, in Victorian times the festive period was typically the time for settling accrued bills. ‘The practice of annual billing at Christmas encapsulates many of the characteristics of consumer credit in [the Victorian period]. For personas of any standing in the local community, annual payment for items purchased at intervals on account was a standard practice.’

Dr Margot Finn, from the University of Warwick, said, “It is a myth that the British are traditionally a nation of stable savers. Long before credit cards became commonplace, under the ‘law of necessaries’ eighteenth century women could pledge their husband’s credit and run up debts in their husband’s name. Also, diaries make reference to debt collecting ‘money hunting’ expeditions by Victorian tradesmen on foot, horseback and by train to extract overdue payments.”


Dr Margot Finn,
University of Warwick,
Tel: 02476 522948/ 01865 553254

Jenny Murray, Communications Office,
University of Warwick,
Tel: 02476 574255/ 07876 217740

The Character of Credit: Personal Debt in English Culture, 1740-1914, is published by Cambridge University Press, 2003.