One thing’s for certain: a cash flow crisis has the potential to cause serious damage to your business, perhaps even fatal damage.

For most businesses the single most important thing they can do to avoid a cash flow crisis is have a clear debt recovery plan in place. Seeing debts as assets rather than drains on a business is an important psychological leap that helps you ensure a positive strategy for keeping your cash flow rolling.

Capital problems in the capital

London may be the UK’s showpiece city with buildings such as the Shard dominating its commercial and actual landscape but it is also one of the areas in the country that is most afflicted with debt problems.

Yes, debt recovery solicitors in London are busy, even in its most prestigious postcodes; in fact, particularly in its most prestigious postcodes, with Notting Hill, Hampstead, Kensington and Chelsea some of the areas with the highest amounts of per capita debt, a lot of which is believed to be related to commercial activity and other projects and investments made by some of the world’s wealthiest private individuals.

But it’s not only exclusive addresses that have massive debt liabilities. Sutton, Lewis, Bromley, Lambeth and Croydon are places with debt problems, albeit for different reasons. The local authorities have real consumer debt problems, with many hard-up people looking for assistance from Citizens Advice for their debt issues, often related to payday loans and other forms of expensive borrowing.

In fact, it’s fair to say that debt is a problem right across the capital, extending well into its consumer belt, with residents of Sutton, Kingston-upon-Thames, Guildford, and Slough all having high levels of debt.

Payday loans are also a big problem in the capital, with payday borrowing a significant burden for people in less well-off areas such as Lewisham, Bromley and Lambeth. These types of loan have been well-documented in their propensity for increasing debt rather than alleviating it as they purport to do in the shiny, happy commercials. However, the high rates of interest can be crippling, if the borrower does not clear the debt quickly.

Despite all of this, in 2016 Bank of England Governor Mark Carney stressed his belief that the UK was not in the grip of a debt crisis. His argument is supported by figures which show household consumption to be slowing, with household debt increasing by “only” £5.1bn per quarter since 2009, significantly less than the £22bn rate between 1997 and 2009.