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Debt Collection News Roundup – September, 2018

Here at Access Credit Management we like to keep up to date with what’s going on in the UJK debt collection industry.  We are committed to bringing our readers interesting and relevant news about the sector, so once a month we publish a News Roundup.  This will help you to keep you up to date with all the important developments in the sector and provide you with a valuable resource that that you can use to stay fully informed of all the latest news.  It would be interesting to know what you, the readers, think of the stories that feature here.  If you have any comments to add or stories you think we should be covering or if you’d like to comment on this or any of our other articles, please do so on our Facebook page or tweet to us on Twitter.

According to a recent report in the Independent, the demand for help with debts has reached a five year high as more people here in the UK struggle to pay for basic expenses.  Claiming that budget deficits result in basic essentials being “out of reach of nearly half of National Debtline callers”.  It seems that many of us are finding it difficult to pay everyday bills.  The National Debtline is run by the Money Advice Trust and reports that fewer people are calling for advice on credit cards, loans and overdrafts, while more callers are seeking help for debts on bills such as rent, energy and council tax.  Half of all callers claim that they are finding it difficult to pay debts of £5,000 or less, a rise from 22% in 2008.  The proportion of callers seeking help with council tax payments has increased from 15% in 2008 to 30% in 2018 while 17% of callers had rent arrears.  The Money Advice Trust is calling on the government and regulators to introduce a strategy to reduce problem debt and ensure that relevant departments, agencies and regulators collaborate on a single, coherent approach.

Meanwhile, the Financial Conduct Authority (FCA) has launched some new rules on how credit card companies should deal with borrowers who constantly experience debt.  A series of guidelines that were proposed earlier this year kicked in on 1st September, in a bid to offer support to vulnerable people who are trapped in escalating or continuous debt.  In future, anybody who is in “persistent debt” for more than 18 months will be offered support with repayment plans or, in some cases, the option to have their cards cancelled to prevent the increase of their debt.  In some instances, lenders may waive interest, fees and charges if these total more than the actual debt repayment.  With more than 4 million credit card holders in the UK who are persistently in debt, the FCA claims that these new rules will save consumers between £310 million and £1.3 billion a year in lower interest charges.

The National Audit Office (NAO) has released a report on tackling problem debt in order to evaluate the Treasury’s overall approach to over-indebtedness and examine its efficacy.  We’ll have more detailed information on this for you over the coming weeks, so be sure to pop back soon.