Lenders are missing the early warning signs of customers' financial difficulties, meaning they're too slow to offer help and borrowers risk falling further into debt, the financial watchdog has found.

The Financial Conduct Authority has been examining the issue of late and missed payments on unsecured loans (loans which aren't secured on property), stating that the way a firm approaches customers' initial difficulties can be "critical to the ultimate outcome" for those customers.

In its findings, published today, it states that while not all late-paying customers are in financial difficulties, "for those who [are] we found that the majority of firms missed early opportunities to identify them and offer appropriate forbearance."

It added that firms often had "multiple engagements" with customers before finally recognising that they were in financial distress.

The review - which encompassed credit cards, personal loans, store cards and point-of-sale finance - found some positive changes from lenders, including greater industry awareness of customers' needs when they fell into arrears.

However it pointed out that much of this change has been recent or is still ongoing, and that help on offer to such customers "varied quite significantly" between different firms.

The FCA said where it encountered "unfair practices" relating to arrears, it had raised its concerns with those firms directly - though it didn't say which firms these were.

Forbearance arrangements - in which a lender does not immediately pursue its legal rights, and instead allows a debtor extra time to pay - can be key to helping struggling customers pay off their debts.

MoneySavingExpert.com founder Martin Lewis has been at the forefront of efforts to promote six months of "breathing space" for those in debt crisis, meaning interest and charges are frozen and enforcement action halted to give them time to get advice to sort their finances.

If you're struggling with debt and in financial difficulty, see our Debt Problems guide for what to do and where to get help, and Debt Solutions for info on formal debt resolution tools.