On his walks through Prague, Badalec steers clear of the picturesque ancient castle. Nor does he stop on the centuries-old Charles Bridge, a bustling attraction for the average visitor.

Instead, the 55-year-old veers off the well-worn cobblestones and into the rougher edges of the Czech capital, a side of one of Europe's most visited cities that many would rather avoid.

"I didn't choose to be homeless," he said after completing an evening tour.

"But I'm trying to do the best I can. I don't steal, I don't cheat people, I don't abuse welfare benefits. The tours are great. They are a chance for me to explain myself better."

Since August, about 430 people have paid 200 crowns to visit the places where some of Prague's homeless gather.

Half of the proceeds go to the guide and the rest to student-run agency Pragulic, set up after it won a 1,500-euro social entrepreneurship award.

SAFETY NET DISAPPEARING

Prague's homeless population, estimated at around 4,500, has not changed significantly in the last three years despite two recessions in the Czech Republic during that period.

Yet a common sight for tourists arriving at the city's main railway station is groups of homeless people sharing cartons of wine.

There are around 600,000 homeless people in Europe, with about a tenth living "rough" on the streets, according to estimates cited by the U.N. Human Settlements Programme.

In ex-Communist countries like the Czech Republic many have been sheltered from the worst of the euro zone debt crisis due to cradle-to-grave state welfare systems, but as that support is eroded there are fears that their numbers could begin to grow.

On a recent soggy evening, Badalec showed up to meet his tour group across from Prague's bus station rolling a large suitcase filled with books.

To make extra money, he collects discarded books from garbage containers, something he was prevented from showing his clients due to the rain.

Instead the group headed over to a largely forgotten plaque next to the bus station commemorating the death of nine homeless people and two dogs in a fire in an abandoned building in 2010.

Other than that, Badalec spent most of the time smoking old cigarette butts and sharing stories about life on the street.

After losing his job in TV news production and going through an acrimonious divorce, Badalec ended up jobless and homeless around a decade ago. He tried finding work, but to no avail.

"Nobody will employ someone who is homeless," he said, standing in a bridge underpass next to a small homeless camp along the Vltava river where he took his visitors.

DRUGS, SEX, STEALING

Eurostat data shows that in 2011, of all 27 EU members the Czech Republic had the lowest share of people at risk of poverty or social exclusion.

Yet the number of personal bankruptcy filings each month in the country has more than tripled in the past two and a half years, according to Creditreform.

For Tomas Jan, director at Prague's Centre for Social Services, the big risk is people holding loans locked into high interest rates. "These people are at considerable risk of social exclusion," he said.

Another Pragulic guide, Karel Lampa, whose street name is "Karim", demonstrated to tourists the spiral a person can fall into when cast out on the street.

His tours start at Prague's main railway station, where Lampa first showed up in the city of 1.2 million people after running away from home some 20 years ago.

The 38-year-old, his eyes outlined by black makeup and fingers covered with jewelled rings, explained how he learned many lessons "on drugs, sex, stealing, life in the sewers, on train wagons, money from prostitution, jail and AIDS."

The alternative tours and part-time work at a volunteer theatre are new outlets after years of prostitution and drug abuse.

"I'm showing people the other face of Prague, dark places of prostitutes, pimps, gangs of thieves, drug dealers, junkies and everything that normal tourists rarely see." (Writing by Jason Hovet)

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