The destructive force that ruins more relationships than Brexit

There's a powerfully destructive force that has destroyed more friendships and family relationships than even Brexit can manage. A new study has revealed this money issue has destroyed 12.6 million relationships across the UK.

The force in question is unpaid IOUs. Research from Paym found that 29% of UK adults admit they had fallen out with someone over an unpaid debt of up to £100.

Some 14% of people have fallen out with family members, and 15% have ended up cutting ties with a friend entirely. Almost one in ten have admitted picking a fight with a partner about not paying money back. And nearly one in three people (32%) even say they have waited more than a year to be repaid.

The study also found that the Welsh in particular are most likely to have fallen out with family (19%) and a partner (17%) over money, whereas Scottish (9%) people are most forgiving for forgotten IOUs.

And while we may be furious with someone for not paying us back, the study showed there's a good chance we have been just as guilty at some point. Almost two in five people admitted they don't always pay friends back - and one in ten say they have avoided repaying a debt to a family member deliberately.

What can you do?

Unsurprisingly Craig Tillotson, Executive Chairman of Paym, thinks the UK's mobile payment service is the answer. He says you can register, and then all people need in order to pay you back is your mobile number. That means you don't need to see them to retrieve cash - or arrange a complicated bank transfer.

However, this will not help in every situation. Dr. Simon Moore, who led the team of psychologists at Innovation Bubble for the study, says that if you decide to lend the money, you need to decide up-front how the money is going to be repaid - and when. Moore says this will ensure that neither party ends up feeling let down.

If the person you loaned money to forgets to repay you when they said they would, Moore says it's OK to remind them. He explains: "From the interviews it was apparent that some people like to be reminded that they still owe money - as it can demonstrate that our friends are reliable and confident - things that we value socially."

You need to make a judgment call about whether they are the kind of person who would let it slip their mind, whether they are suffering financial issues more generally, or whether they are trying to get away without repaying you. In some cases a nudge will be very welcome, in others it will pile added pressure onto someone struggling financially.

Think before you lend

Of course, there's always the chance they will never pay you back, and this is something you need to factor in from the start.

Before handing over any cash, you need to appreciate that even if it's paid back in full and on time, it could have an impact on your relationship. Moore says: "As money holds a status of power in western society, there is an emotive charge when money changes hands between family friends, even if it's only for amounts of up to £100."

If it is a friendship you really value, then you may not want to hound them for the money, or take them to the small claims court, so the most sensible approach is never to lend money you cannot afford to lose.

In many cases, if a close friend asks to borrow a small sum in an emergency, then the answer might be to offer it to them as a gift - and tell them they can repay the favour next time you're in a hole.

That way they get the cash they need, and nobody needs to worry about the risk of an unpaid IOU.

But what do you think? Would you lend money to friends, and has it ever caused you problems? Let us know in the comments.