In today’s bulletin:
- General update
- IE Hub whitepaper
- AI risk management: why Boards must lead the charge in 2026
- Collaborations
- Events
The Regulatory Update for February 2026 is out with subscribers. A quick summary schematic below from Chris. The StepChange average debt balance below relates to Scottish residents approaching them for debt advice. We discuss ‘Vulnerability Management’ entering the tooling phase in today’s bulletin, with a few upcoming events to back this up.
General Update
The conflict in the Middle East is dominating the news. Consumers will start to see the impact of 2 ongoing conflicts where natural resources play a major part, influencing the costs of everyday essentials, including fuel and heating.
The BBC is expecting an impact on inflation. There has been an immediate feed through into the mortgage market. Home mortgages are being repriced by banks https://www.bbc.co.uk/news/articles/cly1jxdv439o who had just started to show some confidence that rates were coming down.
How the FCA is helping to improve outcomes for customers in vulnerable circumstances
You may want to play our Vulnerability Anthem when you read the FCA post from Charlotte Clark, FCA Director.
PLAY ME: The Vulnerability Anthem
The FCA was reflecting on the fifth anniversary of their vulnerability guidance (FG21/1) that has been reviewed and the findings published in March 2025. Vulnerability management continues to feature as a regulatory priority. We have a number of upcoming events on this topic. Under the Duty they have seen a strengthened commitment by regulated firms to:
- identify harm sooner, supported by better data
- build the delivery of good outcomes for customers in vulnerable circumstances into governance, culture & leadership, including ensuring it is a key part of decision-making
- provide more flexible support and more consistent, empathetic interactions to meet the needs of customers in vulnerable circumstances
We will continue to showcase cross-sector case studies and best practices involving many on the circulation.
Link: https://www.linkedin.com/pulse/how-were-helping-improve-outcomes-customers-vulnerable-clark-rdpre/
Meanwhile, Lauren Peel of Inclusive Outcomes is worried that they are not seeing enough focus on ensuring inclusion at the different stages of the product & service design lifecycle under PRIN 2A. As a result of the FCA’s findings in March 2025, Inclusive Outcomes published a whitepaper on embedding inclusion into the propositions process.
As we approach the one-year anniversary, they are suggesting that firms should be asking themselves:
- Are your approaches to lived experience ensuring that people can contribute meaningfully, AND leading to actual change? Lived Experience should not be a check box exercise, especially when people are sharing their personal needs and stories with strangers
- Do proposition leads have the knowledge, the tools and the impetus to design inclusively? Is this consistent, and developing to support better outcomes?
- Are governance processes and measures emphasising inclusion, ensuring that inclusive design and vulnerability is being embedded across the firm?
Given the recent focus by the FCA on good and poor Consumer Duty Board reports around smaller regulated businesses, this may be very topical alongside the ongoing Consumer Understanding surveys.
Link: https://inclusiveoutcomes.co.uk/resources/
Featured report – Vulnerability affects a significant portion of the UK population
As we are all aware, vulnerability affects a significant portion of the UK population, which has been brought into focus again this week by the FCA and others.
Only this week we have seen that Steve Donovan has joined IE Hub from OVO after 16 years with the energy provider. He joins IE Hub as Utilities Partnerships Manager with a lot of activity going on in the essential service sectors under UKRN.
In a new whitepaper by Mark McElvanney, he explores how treating capacity and clarity as key design constraints helped them update their user experience journey. The result? Less friction, clearer guidance, and better support for customers who need it most. The paper highlights the collaboration with VRS.
This is an interesting read, as we look at innovative integrations with IE Hub in the debt advice sector, especially data sharing where the consumer has already completed a recent I & E assessment and consented to share it. Have a listen to our vulnerability anthem and get a feel of how important this is, especially for those who have disclosed multiple vulnerabilities – which was flagged in the FCA Financial Lives findings in May 2025.
IE Hub is a sponsor and presenter at our UK Affordability Summit on 14 April 2026. They will also be attending the VRS Conference on 7 May 2026 in Nottingham.
Reduced bills for around 300,000 households in WaterSure reform
Low-income households who use high amounts of water can qualify to have their bills capped. They must have a water meter and either a specific medical condition or 3 or more children living at home.
The changes set out on 6/3/2026 will expand the eligibility criteria to include disability benefits. This will extend the existing scheme from around 260,000 households by a further 53,000.
Water Minister Emma Hardy said: “Vulnerable households are particularly affected by cost-of-living pressures, including water bills.”
The WaterSure changes include:
- More people with disabilities will qualify. Those receiving disability benefits will become eligible if household income is below £25,745 per year.
- Bills will be capped at the lowest average reading.
- People living alone will have bills capped at the average bill for a one-person household.
- Less red tape. People will no longer need to pay for a doctor’s note to apply, making it quicker, cheaper, and easier to get help.
Grace Brownfield from Money Advice Trust said:
“People with disabilities or long-term health conditions can face particularly high essential costs, including for water, which can leave them more exposed to debt.”
Mike Keil, Chief Executive of the Consumer Council for Water (CCW), said:
“These improvements will bring peace of mind to tens of thousands more customers whose circumstances mean they have no choice but to use a significant amount of water for essential needs.”
Andrew White of CCW is in my panel session at the Vulnerability Registration Service Conference on 7 May 2026 in Nottingham. CCW played a leading role in shaping the reforms having carried out a review of WaterSure and submitted recommendations to government early in 2025. We will also have Jemma Baker from Ofgem. Collaboration and data sharing will be key topics on the day, including increased enrolment in the PSRs and social tariffs.
I am sure that this will also be discussed at our Affordability Summit on 14 April 2026 in Manchester. We have a number of income optimisation experts on the panel.
As previously reported, Water UK published the differences in the annual average bill changes for 2025-2026.
Link: www.water.org.uk/annual-average-bill-changes-2025-2026
In late January 2026, Water UK issued a news story on average water bill increases. As is evident, support varies locally and can include reduced bills, payment breaks and, in some cases, debt forgiveness.
Link: https://www.ccw.org.uk/news/watersure-reforms-extend-bill-support-to-thousands-more-households/
Link: https://www.gov.uk/government/news/reduced-bills-for-around-300000-households-in-watersure-reform
Future proofing Council Tax Support for LGR and the 2027 policy reset
A useful Blog from Policy in Practice, who are one of the sponsors and speakers at the Affordability Summit on 14 April 2026 in Manchester. This covers some of the policy changes coming into effect in 2027. Debt advisers need to keep pace with the changes.
Local Government re-organisation, welfare reform, judicial reviews and the Child Poverty Strategy are all reshaping how councils need to design CTR schemes for 2027. This blog explores:
- Why councils are reviewing their schemes
- The policy changes coming down the line
- Practical lessons from South Norfolk and Broadland District Councils
- How data can improve take up and reduce avoidable arrears
CAP report – ‘Barriers to Work’
Christians Against Poverty (CAP) has reported that major barriers to work include poor mental health (49% of survey respondents), lack of confidence, physical ill-health and age-related discrimination. Structural obstacles like insecure hours, low pay, and a lack of flexible roles for caregivers or those with health conditions further entrench poverty.
With unemployment at a five-year high and households under mounting financial pressure, the blog calls for urgent action to create more secure and inclusive pathways into work.
Key findings from CAP regarding employment barriers include:
- Mental Health & Confidence: 49% of those surveyed reported that unemployment negatively affects their mental health, which in turn hinders their ability to secure work. 25% reported a lack of self-confidence.
- Systemic & Structural Issues: Many face high volumes of job rejections (9m adults made over 10 applications in the past year).
- In-Work Poverty: Employment does not guarantee financial stability due to insecure hours and low wages.
- Personal Circumstances: Health issues, caring responsibilities, and lack of available, flexible, and supportive jobs prevent many from securing or sustaining employment.
- Technological Shift: Fear that existing skills will be replaced by AI.
CAP recommends focusing on long-term, sustainable, and secure employment rather than just immediate job placement, advocating for more flexible, high-quality jobs and better, person-centred support.
Link: https://capuk.org/news-and-blog/rethinking-the-barriers-to-work
ECB – Chief Executive’s Report – March 2026
“There is a separate agenda item on the new Vulnerability and Ability to Pay standards. Papers include the near final draft of the Standards and report on the consultation responses, including a summary of the key changes that we have made in response to our analysis of the feedback to the consultation. The paper includes the proposed plan for publication and implementation timelines, and our intention is for the final standards to be introduced in March 2026. We are also sharing the final reports of our independent research with agents and people with lived experience of enforcement. We intend to publish these in full as part of launching the Standards.”
The March Board meeting covered a lot of ground, including updates on their thematic review of fee-charging, the latest complaints data, and the Board signed off the final version of their Vulnerability Standards, which will be published later in March 2026.
DEMSA responded to the consultation on the Vulnerability and Ability to Pay standards. We also supported a joint event with CIVEA in November 2025 where the ECB set out their expectations on enforcement firms and agents. The consultation may result in some changes to proposals. We shall monitor progress.
Chris Nichols is presenting at the VRS conference on 7 May 2026 in Nottingham. DEMSA covered their Insights Report from January 2026.
Link: https://enforcementconductboard.org/chief-executives-report-march-2026/
Link: https://enforcementconductboard.org/wp-content/uploads/2026/01/ECB-Insight-Report-2026-1.pdf
Motor finance compensation scheme to include implementation period
The FCA is considering over 1,000 responses to their proposals for a compensation scheme for motor finance customers who were treated unfairly. They are also wanting for compensation to start in 2026.
Their advice remains that anyone concerned they weren’t told about commission involved in their motor finance deal should complain now. Doing so means they should get any compensation sooner. There is no need to use a CMC or law firm.
The regulator has cracked down on poor practice by FCA-regulated CMCs. Over 800 misleading adverts have been removed or amended since January 2024 and they have intervened with 5 CMCs causing harm: 2 reduced exit fees and 4 agreed to stop taking on new clients until they can show they comply with our rules.
Supporting parents’ mental and financial wellbeing
For many parents, financial stress plays a major role in that experience – from the cost of childcare to the responsibility of providing stability and security for another person. PayPlan at the support that is available.
Link: https://www.linkedin.com/pulse/supporting-parents-mental-financial-wellbeing-payplan-h8zie/
AI risk management: why Boards must lead the charge in 2026
This story has been covered by UK Finance and is topical across Financial Services for firms of all sizes. It is a topic that Chris and I want to develop in H1 2026.
AI introduces company-wide risks – ranging from malicious use to malfunctions – that demand rigorous control, governance and active firm-wide oversight. If not managed and mitigated effectively, these can directly affect financial performance, undermine compliance and erode brand trust and reputation.
AI risk management and oversight must therefore be a standing item on Board and executive agendas, ensuring organisations capture and accelerate AI’s value, without losing control of its rapidly evolving risks.
There appears to be some pressure on the FCA to recognise this challenge around accountability. Whilst many firms don’t have all of the roles discussed, there will be some alignment to the CEO, CFO, CRO and CFO roles.
For Boards that want to lead in this area by proactively addressing AI risks, the author’s top-level advice is to:
- Set the tone at the top – Embed AI risk into frameworks and ensure ethical principles and defined standards direct AI use.
- Demand transparency – Require clear reporting on AI systems, their purpose and associated risks.
- Ensure accountability – Confirm that roles & responsibilities for AI oversight are defined and enforced.
- Stay ahead of regulation – Continually track and respond to evolving laws and best practices to maintain compliance and trust.
- Invest in education – Boards should upskill themselves and their teams on AI fundamentals and risk implications to ensure readiness and response.
- Invest in AI tooling – Strengthen risk management & resilience through specialised tools and platforms for AI risk monitoring, model validation and compliance tracking.
Much of this is relevant in the lead up to the next round of Duty Board reporting in July 2026. Some of this also closely aligns with another blog around the financial crime trends in 2026, where AI inevitably features.
Establishing Oversight Structures: Boards are increasingly forming dedicated Technology & Governance Committees to provide focused scrutiny of AI initiatives. With more sector collaboration (e.g. Debt advice LLMs), we may need to be more flexible, where many firms are small and could benefit from shared thinking and resources. This has been in evidence in the Credit Union sector. My work with MEGA.AI, systems integrators and other FinTechs is around committing to cross-sector forums to look at the direction of travel and AI adoption in our sector.
Integrating AI into Risk Management Frameworks: AI risk must be embedded into your firm’s Risk Management Framework, moving from periodic reviews to very regular monitoring, with regularity determined by your firm’s risk appetite.
Defining Risk Appetite: Boards must determine the organization’s risk tolerance for AI, balancing the “risk of not moving boldly enough” against potential liabilities.
Ensuring Human Accountability: Boards must enforce the principle that human judgment remains the final authority, particularly for high-stakes automated decisions.
Conduct an AI Audit: Implement a comprehensive inventory of all AI deployments, possibly shadowing AI usage by employees without formal approval. This may have crept in inadvertently over the last couple of years.
Upskill the Board: Ranging from AI-driven crisis scenarios (e.g. leading to invoking Wind-down plans) to more pro-active approaches aligned to future competitive strategy.
NCSC is warning firms to look at their security posture with the Middle East conflict involving Iran. There is a risk that the battle moves from being military muscle to stealthier activities that detrimentally impact consumers and disrupt UK businesses. The statement says that Iranian state and Iran-linked cyber actors almost certainly currently maintain at least some capability to conduct cyber activity.
My view
In 2026, AI risk management has shifted from a technical IT function to a critical board-level responsibility due to the rapid integration of autonomous AI and a strictly enforced global regulatory landscape. Boards must lead this charge to safeguard enterprise value, as unmanaged AI risks can now lead to catastrophic financial, legal, and reputational consequences.
I found completing the survey for the Mills Review of use. Chris and I are working on a more user friendly version.
Interestingly, MaPS has a webpage entitled ‘Can AI help with money decisions? What you need to know before you rely on it’. There is a risk that employees take the same approach. The Which? article is worth a look. The debt adviser LLM sponsored by MaPS seems an obvious way forward for genuine FCA-regulated debt advisers. An early challenge will be how do we wire the LLM into our various operating models. We have many of the right partners on the bulletin circulation. Hear from some of them on 14 April 2026 in Manchester at the Affordability Summit.
Link: https://www.moneyhelper.org.uk/en/blog/financial-education/can-ai-help-with-money-decisions
Collaborations
Target Group and FourNet
Target Group has shared a recent case study with FourNet, showcasing how they have modernised and strengthened their contact centre compliance through a powerful blend of technology, process redesign, and partnership.
Target Group is one of the UK’s leading Business Process Outsourcers (BPO), specialising in the financial services industry. With over 30 major financial services clients and 19m end customer contacts; Target Group’s contact centre is the beating heart of their organisation.
With FourNet’s support, they have moved from fragmented systems to a single, unified platform, giving their teams clearer visibility, better governance, and a far more streamlined experience. The outcome:
- Stronger compliance controls
- Improved auditability
- Faster, more consistent customer outcomes
- A future-proof foundation for ongoing digital transformation
This project is a great example of what happens when 2 organisations come together with a shared focus on operational excellence and doing the right thing for customers. I am pleased to be a small part of this from the FourNet Consumer Duty events we ran to the client specific focus on QA Frameworks using the capabilities of the NiCE platform.
Target Group’s previous QA process, like many financial services BPOs, was limited to a handful of manually selected calls each month. It gave managers a snapshot of compliance performance, not the full picture. For a business that handles regulated conversations on behalf of multiple high-street lenders, that wasn’t enough.
FourNet is working closely with Target Group’s compliance and QA teams to redesign their QA Framework. The collaborative approach focuses on building scorecards that reflect FCA Consumer Duty priorities, emphasising fairness, vulnerability recognition, and outcome-based measures rather than generic call-handling criteria.
Through ongoing workshops, the teams are developing an automated review model that will track conversations for key compliance indicators and sentiment shifts. Once fully implemented, this will enable Target Group to identify risk trends across thousands of calls rather than relying on small monthly samples.
The roadmap includes automated quality scoring across a much larger share of interactions, so risk indicators can be surfaced earlier. Human reviewers remain accountable for coaching, escalation, and final judgement; shifting effort from sampling and checking to improving outcomes.
Link: https://fournet.co.uk/content-hub/target-group-contact-centre-compliance-transformation/
BPO Collections and MEGA.AI go live
A big moment last week for Peter Hauge Jensen, co-founder of MEGA.AI, and Alasdair Skeoch at BPO Collections and Everyday People Financial Solutions, as the MEGA.AI ID & V voice agents went live.
Over the coming weeks, they will continue refining performance, reviewing data, adjusting scenarios, and making sure every interaction meets the highest standards for compliance, customer experience, and operational performance.
TCN and Arum Global
TCN, a leading global provider of cloud-based contact centre solutions, is pleased to announce that its award-winning contact centre software, Operator, has been formally recognised as an Arum Approved System, following a comprehensive independent assessment conducted by Arum Global.
This certification confirms that TCN meets the standards required to support current and emerging operational needs across its markets, including the UK, EU & US. The Arum Approved System programme evaluates technology providers against industry expectations, regulatory demands and future-readiness. TCN’s platform successfully met the full assessment criteria, demonstrating strong capability, configurability and alignment with the evolving needs of modern contact centre operations.
Arum-approved certification provides independent validation that a collections technology platform meets the standards required by leading credit organisations. It recognises real-world capability, delivery readiness and alignment with best-practice outcomes, giving buyers confidence in an increasingly complex technology landscape.
Kerry Sherman, Vice President, EMEA, said:
“We are delighted to receive Arum’s formal approval, which reinforces the strength, flexibility and future-readiness of the TCN platform. This certification reflects our commitment to delivering technology that genuinely empowers organisations across the UK and Europe to operate with confidence, compliance and efficiency. Our partnership with Arum brings together deep industry expertise and a shared ambition to raise the standard of customer engagement solutions across the region.”
Arum Global is a Gold sponsor and speaker at the Affordability Summit on 14 April 2026 in Manchester. TCN is running an event on 12 March in Stratford-upon-Avon https://luma.com/p7u8sp9x with partners DebtStream, Debtrak and MEGA.AI.
Kerry recently played host to Martin and Peter from MEGA.AI in Utah. We are hoping that Owen won’t give us such a hard time with the Arum Approved process for the MEGA.AI platform – which is coming soon.
Link: https://www.tcn.com/newsroom/press-releases/tcn-achieves-arum-approved-system-status/
Chris Warburton recently caught up with Martin. MEGA.AI is also a Gold sponsor of the Affordability Summit on 14 April 2026. They discussed ‘AI transformation in contact centres and beyond’.
Link: https://www.ro-ar.com/ai-transformation-in-contact-centres-and-beyond/
Whipps Enforcement and VRS
This partnership highlights the growing importance of identifying and understanding the needs of vulnerable customers, particularly in light of the Enforcement Conduct Board’s (ECB) guidelines on the treatment of vulnerable customers. Ensuring fair, appropriate and compassionate engagement is not just good practice; it’s essential to raising standards across the enforcement sector.
Events
Debt Awareness Week
Driving better outcomes for Vulnerable customers – 24 March 2026 in Manchester
I have posted on this. I am pleased to be supporting this event on 24 March in Manchester, where I am joined by MorganAsh and the Vulnerability Registration Service (VRS). We will be looking at joint FCA/ICO statements around data sharing and the focus of the ‘Mills Review’ around AI in Financial Services.
This should be timed with the next FCA Regulatory Priorities updates for sectors beyond insurance and investments. We can expect updates to the Ofgem and Ofwat vulnerability strategies through the course of 2026.
This cross-sector event is all about practical deployment of innovative technology and partnerships to deliver better consumer outcomes at scale. Alongside innovation, we explore the necessary safeguards to protect consumers, including how to build trust in an ecosystem that is seeing a rise in scams, coercion and fraud. Andrew Gething will discuss the importance of well structured and accurate data.
Integrating data sources like the VRS can assist in providing the most effective treatment path using disclosed data as to what someone is ‘vulnerable to’ and their support needs. Efficient consented VRS registration pathways also enable a ‘tell us once’ approach, which is used by platforms like the MorganAsh MARS system.
Common themes will be:
- 💡 building consumer trust
- 💡 identifying vulnerability
- 💡 safe adoption of AI with the required safeguards
- 💡 consumer understanding
- 💡 effectively monitoring consumer outcomes
We look at ‘what good looks like’ at scale, where best in class services and providers are integrated into the ecosystem.
Join the IP Integration team for an insightful event and excellent networking, where all the speakers will be available after the afternoon sessions.
Blog from Sam Grant of IPI.
Link: https://www.linkedin.com/pulse/2026-when-consumer-duty-moves-from-framework-proof-sam-grant-pbrjc/
Free Registration link: https://share-eu1.hsforms.com/1I5BdqzKRRy2zhcUEyuGl3wf1lnq
Affordability Summit – 14 April 2026
DEMSA is delighted to be supporting the Affordability Summit on 14 April 2026 at the Core Technology Facility in Manchester. The venue is highly relevant to the innovation and interactive theme for the day. The cost-of-living crisis has now been with us for some time, impacting millions of UK consumers. April triggers increases in essential service costs, tax code changes, new SFS figures and assessing changes in disposable income at a household and individual level.
We already have a great delegate list with Tier-1 banks, UK Finance, Money and Pensions Service, the Centre for Responsible Credit, leading Utilities, debt buyers, enforcement firms, debt resolution firms, CRAs, vulnerability specialists and leading debt solution providers. Chris Warburton will hold the whole programme together.
Our thanks to our speakers – Daniel Kelly, Damon Gibbons, Rachel Curtis, Victoria Oliver, Dylan Jones, Mark McElvanney, Kenneth Doherty, Shaunna Austin, Sam Manning, Rob Johnson, Tracey Stone and Carlos Osorio. Lowell is also speaking (TBC).
VRS conference on 7 May 2026 – Nottingham Forest Football ground
The agenda is just about complete, with Alison Walters from the FCA delivering one of the keynotes. Opening keynote from Lord Holmes MBE – a technology policy leader and advocate for inclusion and accessibility. John Fairhurst from PayPlan is on the main podium and Emma Gibbons is supporting their exhibition stand.
New MALG CEO, Peg Alexander is facilitating the ‘data geeks’ session entitled “Breakout 2a: Vulnerability Through the Lens of Data: New Evidence & Emerging Trends”.
Chris and I are both running sessions. I am looking forward to having Ofgem, CCW and Gamcare in my session ahead of Dennis Bishop from TU.
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