DEMSA update: Consumer Duty planning / SDRPs / Unclaimed benefits / Digital debt advice / spotlight on Gambling / Events

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General update

As previously reported, the Bank of England has forecast the UK will fall into recession towards the end of 2022 as energy costs continue to rise. The National Institute of Economic and Social Research said it expected the UK economy to continue falling over the next three quarters. Capital Economics said there was now a greater risk that the economy will shrink by 0.2% between July and September before worsening.

SDRP update

I sent out an SDRP update on 8 August 2022 covering the SDRP responses from UK Finance, RTL and Citizens Advice. On the DEMSA LinkedIn SDRP posting, I have covered the release from UK Finance. The UK Finance press release calls for a period of reflection around Statutory Debt Repayment Plans (SDRPs).


They have also been clear that the regulations should not have any legal effect on a Consumer Credit Act (CCA) credit agreement, where the CCA will be subject to reform after announcements by HM Treasury in June 2022 when John Glen was still Economic Secretary to the Treasury.  

The Money Advice Trust response is now in the public domain.


Whilst supportive of the intentions of SDRPs, MAT has highlighted the need for more flexibility and clarification in a number of areas. The scope of The Insolvency Service platform is one of the important areas of comment, reflecting on the limited scope of the system implemented for the Debt Respite Scheme in May 2021. They have also discussed the mechanics of regulated debt advisers administering an SDRP if they use a payment distributor like The Insolvency Service.

The level of disposable income for National Debtline customers referred to StepChange for a DMP was very high in 2021 (£270). It is evident from the National Debtline response that they have limited experience of administering DMPs.

Energy prices increases

Ofgem and industry body Energy UK have said that it is “possible” for suppliers to raise customers’ direct debits before the new cap on energy prices kicks in. British Gas owner Centrica has confirmed that direct debits could go up before the start of October. The BBC article has canvassed a number of the major suppliers on their policy.

My thanks to Gareth at CAP for the link below. This new report (launched 7 August 2022) by Professor Donald Hirsch, Loughborough University, reveals the gap between the support the government is currently offering to households and the anticipated rise in living costs. It concludes that millions of families are at risk of going without, because the support they’ve been given simply doesn’t stretch far enough.

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The debt advice sector has strongly supported engagement between the government, energy regulators, energy providers and the debt advice sector to look at effective remedies for dealing with rising arrears and the impact this has on other household payments, including other credit commitments.


The link to the Fair By Design video around social tariffs in energy is interesting.


Richard Healey of PayLink Solutions has also posted a video around rising energy costs.

Manu from InBest has commented on an interesting post on LinkedIn around unclaimed benefits. InBest is mentioned along with IncomeMax, EntitledTo and Policy in Practice.    

chart, pie chart

MaPS ‘open source’ SFS

I have dropped Daniel Kelly a note around getting an update on the ‘open source’ SFS being made available to debt advisers.

Update from FCA Innovation Day on 13 July 2022

Further to DEMSA attending the Innovation Open Day at the FCA Offices on 13 July 2022, Rohan Malhotra responded to me regarding DEMSA members who might be looking to develop automated debt advice models to complement their existing services. Several on the circulation have already gone down this path, with others now taking this forward. Rohan is a Senior Associate in the Innovation Pathways team at the FCA.

Here are some links to the Innovation Pathways support services, including details of some of the firms they’ve supported:

As part of the wider picture around digital customer journeys, this is an important topic and will need to closely align with regulator expectations around the Consumer Duty where they have made some fairly clear statements around ‘digital only’ journeys in FG22/5.  This is particularly relevant around dealing with customers with characteristics of vulnerability, which is a bit of a link into the next topic.

Vulnerability refresher training around FG22/5 and FG21/1

I am working with the Vulnerability Registration Service (VRS) to look at refresher training around FG21/1 (FCA vulnerability guidance) aligned with the Consumer Duty (PS22/9 and FG22/5). This follows on from my post of 30 July 2022 just after PS22/9 was published around implementation planning for regulated debt solution providers. 

Financial Services firms have until 31 October 2022 to get their Consumer Duty transformation plans in place. For consumer credit firms, disapplying PRIN 6 and 7 and replacing with PRIN 12 and the new rules needs reflection in the ‘key questions’ from the non-handbook guidance (FG22/5) supporting PS22/9. FG21/1 made numerous references to the 6 TCF outcomes.

Examples around inclusive design and vulnerability include:

  • How has the firm identified if their product or service has features that could risk harm for groups of customers with characteristics of vulnerability?
  • What assessment has the firm made about whether its customer support is meeting the needs of customers with characteristics of vulnerability?
  • How does the firm adapt its communications to meet the needs of customers with characteristics of vulnerability, and how does it know these adaptions are effective?
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These are the type of questions that Chris Fitch touched upon at the recent Collaboration Network Vulnerability Summit. I have reviewed the non-handbook guidance (FG22/5) and aligned some of the FCA questions into an updated TCF gap analysis and internal audit process, which we used extensively in the transition between interim permissions and full permissions in 2016 and 2017.

Several respondents to CP21/36 asked for the status of the treating customers fairly (TCF) outcomes under PRIN 6 to be confirmed. It is evident how many references there are to PRIN 6 and PRIN 7 in the FCA sourcebooks (e.g. CONC 8 for debt advisers).

The FCA response recognised the significant overlap between the TCF outcomes and the areas covered by the Duty – in particular the 4 outcomes rules and guidance. The FCA confirmed that firms should focus on complying with the Duty where it applies, rather than the TCF outcomes.

As set out above, I am working through FG22/5 and FG21/1 with regard to some of the key questions that the FCA is likely to ask high risk permission firms around their preparatory work post-October 2022. The intent being to refresh TCF policies, vulnerability policies, gap analyses around the 6 TCF outcomes and annual TCF audits. This is particularly relevant around the PS22/9 statement that “Firms should have appropriate oversight of customer outcomes through their systems & controls. Risk functions should pay attention to consumer risks and this should also be a key lens for internal audit”.

The new ISO 22458 international kitemark is looking very relevant for this exercise.

I am starting to book Consumer Duty ‘gap analysis’ sessions as part of a ‘path to 31 October 2022’ process. Drop me a line if you are interested in support in this area.  

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The build-up to the Women in Credit awards is continuing with the nominees in the public domain. Following the Lionesses winning the recent ladies football tournament, I am not sure whether Credit Strategy has published what is appropriate behaviour for award winners.   


CSA conference – 15 September – Caroline Siarkiewicz is keynote


Stop Loan Sharks week starts 26 September 2022

A number have posted on the link from Cath Wohlers of the Illegal Money Lending Team. I have picked up from Russell’s CIVEA post. I have commented:

“It is imperative that those in direct contact with consumers at risk of loan sharks have the knowledge, can spot the symptoms and are confident to engage. Tools like the Vulnerability Registration Service help spot some of these symptoms. DEMSA will continue to get the message out with affiliates like VRS”

I am hoping that this is a common cause towards better outcomes.

Vulnerability Summit – 5 October 2022

I am looking forward to being on one of the panel sessions at the Vulnerability Summit on 5 October 2022. More on this in the coming weeks. I may have to have a couple more discussions with Chris Fitch in his shed by Teams/Zoom. I am sure that Sonya Schofield will help me out and that a few of our affiliates on the circulation can provide me with useful context. We have a few providers like Cerebreon that have helped me at Open Banking events (e.g. Credit Summit 2022) around detecting gambling. The is an important topic for both debt advice providers and personal insolvency practitioners. This can be a driver for greater access to platforms like VRS and other self-exclusion platforms when looking at this from a responsible lending perspective. There is always a balance, like BNPL debates, around minimizing friction in everyday processes for the ‘average consumer’ (in FCA Consumer Duty language) and those where additional support and due diligence is required, especially where there are triggers to use tailored customer journeys.         

Gambling – Protecting those vulnerable:

  • What measures can and should be put in place
  • Gambling and regulation
  • Gambling limits – technology available
  • Responsibility of the lenders

I welcome any input.



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