LONDON (Reuters) - The collapse of the Farepak Christmas savings club last year has driven many of its low-income victims into a cycle of debt, a union-sponsored report said on Monday.

Over 122,000 people have lodged claims totalling 38 million pounds with Farepak's liquidators since it failed in October 2006.

Many of those affected were low-paid women saving small sums for Christmas who went into debt to buy the gifts they had been expecting to purchase with their Farepak savings, the report from public sector union Unison said.

The study, jointly sponsored by the Centre for Crime and Justice Studies (CJSS), interviewed Farepak savers and examined the impact on their lives.

It found that for some the money they had given to Farepak was the only money they had saved for Christmas.

"I didn't have any other savings ... I was basically counting on that for Christmas," one victim told the study.

"I think it is annoying that they just treat ordinary working class people like that when they are supposed to work with you," said another.

The report called for all savers to be fully compensated -- they have been told to expect just 5p in the pound for their claims, and that there will be no payout this year.

"Many (Farepak customers) are asking why, if the government was prepared to underwrite Northern Rock to the tune of billions of pounds, no comprehensive help has been forthcoming," said CJSS Director Richard Garside.

Little warning was given that the savings might have been at risk, the study said.

"The idea that Farepak savers could protect themselves from the company's collapse is clearly challenged by this research," said one of the report's authors, Birmingham University lecturer Basia Spalek.

The government says it has taken action to prevent another Farepak-style collapse, with other Christmas savings clubs now putting savers' money into ring-fenced accounts.

It said the government-backed charity the Family Fund has paid 8 million pounds of support to Farepak victims.