High Street banks have introduced strict new rules designed to prevent consumers from taking on too much unaffordable debt.

Under the strengthened code of practice lenders must make certain that consumers are financially able to pay back any money they are borrowing.

This involves assessing their income and financial commitments and looking at how well they have managed their finances in the past.

They must also ensure that any money taken out for debt consolidation purposes is actually used to clear their debts, and not for other things.

The number of individual bankruptcies has risen considerably in recent years, and consumer debt is now at record levels. This has prompted the banks' move.

Seymour Fortescue, chief executive of the Banking Code Standards Board, said: "In the context of rising concerns about personal indebtedness, our reviews have suggested ways in which the code could be strengthened.

"We are pleased that our recommendations have been accepted by the industry and believe they should encourage responsible lending and responsible borrowing."