Anybody who has applied for a personal loan recently (and if you’re reading this, then it is likely that you have done, or are thinking about it) is likely to be aware of just how difficult it is to obtain a cheap loan at the moment.

But a new survey from Moneyexpert.com has revealed just how hard the personal loan industry has been hit by the effects of the credit crunch.

According to the survey, the total number of personal loans which are available on the high street, or through a broker, has dropped by almost half since the beginning of the year.

For a borrower who is looking for a loan of £5,000, there was a choice of 105 different loan deals at the start of this year, but now this figure has dropped to 57, severely restricting a potential borrower’s options.

At the same time as this, the typical Annual Percentage Rates (APR’s) for personal loans have increased by almost three times the rate which was applicable in January. They typical APR on a £5,000 loan now stands at 29.40 per cent, compared with 10.65 per cent at the start of the year.

The main reason given for this increase in personal loan rates is due to an increase in higher risk borrowers and bad credit loan applications and despite the Bank of England reducing interest rates significantly, this does not seem to be having any effect on the personal unsecured loan market.

Sean Gardner of Moneyexpert.com said “December is normally a time to give, not it seems if you’re a loan provider however. With unemployment on the up, lenders are increasingly thinking twice before offering money they’re much less sure they’ll get back. The cost of this risk is being passed on to us all with higher APR’s and fewer products available.”