KEY THEMES+ ¦ DEMSA Summary

What you need to know this week

Affordability remains a defining issue in 2026 as firms face rising household cost pressures, growing debt stress and closer regulatory scrutiny ahead of the Affordability Summit on 14/4/2026 in Manchester.
MaPS’ latest update highlights the updated Standards, the new MaPS Standards Portal and the upcoming FCA review, with Daniel Kelly presenting on the SFS and new innovations at the Affordability Summit.
Firms are being pushed to improve affordability journeys so customers can disclose income and expenditure more honestly and with less friction during assessments.
Hope Macy says it has built a straight through affordability process within its Slick lending platform that can assess a credit application in under one second while keeping affordability and vulnerability central to decision-making.
Arum Global argues that utilities that lead on affordability in 2026 will be those that strengthen data quality, affordability assessments, vulnerability identification, cross-utility data sharing, frontline training and system scalability.
The Bank of England has warned that Middle East conflict-related shocks could intensify financial instability, while UK lending defaults and unsecured lending defaults have both risen in early 2026.
The FCA is using credit file data and analytics to track consumer credit journeys over time, aiming to identify distress earlier and support more targeted supervisory action.
The FCA’s approach focuses on movement between consumer risk segments, with missed payments, rising utilisation and multiple new unsecured accounts acting as indicators of deteriorating financial resilience.
Consumer Duty work is increasingly linking fair value and customer understanding, with firms expected to show that customers receive ongoing value and understand products and services throughout the journey.
The ICO’s final guidance under the DUAA 2025 requires firms to handle data protection complaints internally before escalation to the regulator from 19 June 2026, creating practical friction points with FCA DISP.
The FOS reports a clear rise in consumers using generative AI to draft complaints, with inaccurate or overly long submissions creating extra operational burden and slower case handling.
The bulletin also flags a busy events and collaboration agenda, including the LinkedIn Live follow-up on 17 April 2026, the CIVEA conference on 23 April 2026 and the VRS conference on 7 May 2026 in Nottingham.

Key Themes

Affordability pressure is intensifying across sectors

Affordability is becoming a defining challenge across credit, utilities and household budgets, with firms expected to improve how they collect and interpret customer financial information.
This matters because affordability assessment quality is increasingly linked to customer outcomes, operational resilience and supervisory scrutiny.
link, link

Economic stress is feeding into higher default risk

A worsening domestic outlook, rising lending defaults, refinancing pressure for households and concern that external shocks could amplify instability.
This matters because firms in lending, arrears management and collections may need to prepare for higher distress volumes, changing demand patterns and more complex customer support needs.
link, link, link, link

The FCA is moving towards earlier, data-led intervention

The FCA is analysing consumer credit journeys using credit file data and statistical methods to identify distress earlier and to understand direction of travel, velocity and persistence of deterioration.
This matters because firms may be expected to act before arrears arise, using more proactive support models informed by affordability, vulnerability and emerging risk patterns.
link, link

Consumer Duty work is becoming more integrated

The bulletin links fair value and customer understanding as connected requirements under Consumer Duty, particularly for debt management firms delivering ongoing services such as DMPs.
This matters because board reporting, product governance and customer communications will need to evidence not only value but also customer comprehension across the full journey.
link

Complaint handling is becoming more complex

The ICO’s final guidance requires a formal internal process for data protection complaints, with acknowledgement, investigation, updates and outcomes, while FCA and Government redress reform is also progressing.
This matters because FCA-regulated firms may need to redesign complaint policies, triage and escalation routes to manage overlap between ICO requirements, DISP, FOS processes and hybrid complaints.
link, link

Key Statistics

Over 90 attendees are reported for the Affordability Summit.
Hope Macy says it can assess a credit application in <1 second.
Hope Macy has moved past the £400m processing target for unsecured lending and is now targeting £1 billion.
Energy debt has reached £5.5 billion.
2.5m households are already receiving some form of financial support.
Loan defaults rose to 6.2% in early 2026.
The late 2024 comparison point for loan defaults was 7.8%.
Unsecured lending defaults hit 18.6% in Q1 this year.
Around 1.8m households will be refinancing mortgages this year.
The total value of assets held by UK Credit Unions fell by 0.08% to £4.91 billion in 2025 Q3.
Credit Union adult membership declined by 0.84% to 2.16m in Q3 2025.
Total value of net liabilities in arrears increased by 3.18% to £269.58m in Q3 2025.
FCA consumer groups are set out as Distressed (5%), At Risk (5%), Secured Credit Users (≈33%), Unsecured Credit Users (≈20%) and Low Credit Engagement (≈33%).
In a small FOS sample, up to a third of responses to initial assessments appeared to have been generated or heavily assisted by AI.
The Digital DRA TV campaign runs for 6 weeks.
A new version of ISO 42001 was published on 31 March 2026.

Newsletter Contents

General update from MaPS, including revised Standards, the Standards Portal and the upcoming FCA review.
Affordability Summit coverage, sponsors, speakers and attendance momentum ahead of 14/4/2026 in Manchester.
Commentary on how firms ask customers about income and spending during affordability checks.
Hope Macy’s straight through affordability process and AI-assisted underwriting within its lending platform.
Arum Global’s view on why utilities need stronger customer insight, data governance and vulnerability identification in 2026.
Economic and credit risk commentary covering defaults, refinancing pressures and broader financial stability concerns.
FCA work on tracking consumer credit journeys and using analytics to identify stress earlier.
Reflections on the scale of FCA activity into Q2 2026 and the need to align this with governance, resilience and reporting agendas.
Consumer Duty material linking fair value and customer understanding for compliance and senior management audiences.
ICO complaint handling requirements under DUAA 2025 and the interaction with DISP, FOS and redress reform.
FOS commentary on the impact of generative AI on complaints quality, case handling and operational workload.
Collaboration updates, appointments and forthcoming events spanning affordability, enforcement, vulnerability and AI governance.

Find the full DEMSA newsletter, commentary and links here

#DEMSA

RO-AR insider newsletter

Receive notifications of new RO-AR content notifications: Also subscribe here - unsubscribe anytime