DEMSA update: Cost-of-Living / Consumer Duty / Identity management / ESG / Cyber-security / Vulnerability / Events

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The headlines have obviously been the announcement of the energy cap figures for October 2022 by Ofgem. On 26 August 2022, Ofgem has announced the energy price cap will increase to £3,549 per year for dual fuel for an average household from 1 October 2022. 

Bar chart showing what costs are included in your energy bill

Ofgem’s CEO has warned of the hardship energy prices will cause this winter and has urged the incoming Prime Minister and new cabinet to provide an additional and urgent response to continued surging energy prices.

Jonathan Brearley, CEO of Ofgem, said:

“The Government support package is delivering help right now, but it’s clear the new Prime Minister will need to act further to tackle the impact of the price rises that are coming in October and next year. We are working with ministers, consumer groups and industry on a set of options for the incoming Prime Minister that will require urgent action. The response will need to match the scale of the crisis we have before us. With the right support in place and with regulator, government, industry and consumers working together, we can find a way through this.”   

Middle earners, as well as low earners, are likely to need government help to pay their energy bills this winter, Chancellor Nadhim Zahawi has warned.



Gareth McNab of CAP has responded:

“Each year CAP helps over 13,000 people and, from calls to our debt helpline, we know that many of the most vulnerable households are already unable to pay skyrocketing energy prices. A great many more will be added to their number, as bills under this new price cap will have trebled since last summer.

“It is outrageous that across the UK, today, families are living in fear about how they will stay warm or even stay alive throughout the winter months.

​“We have been told that support is coming — but there is as yet little evidence that those making those promises truly understand the scale of the problem, nor the urgency with which they must act.”


Phil Andrew, CEO of StepChange, said:

“Energy companies are now the top referrers of clients into our charity, and the proportion of new clients with energy arrears has doubled since 2019. In July, a third of our new clients were in energy arrears – in summer, even before the October price rise takes effect, let alone the even higher price cap announced today. Unless more support is forthcoming, the proportion of clients with a negative budget could rise from around a third now, to over half once the January price cap takes effect.

“Household budgets are being pushed to the absolute limit and it’s inevitable this will lead to more people experiencing debt. The demand for debt advice is rising across the sector as the cost of living crisis bites. Many of our existing clients are also having to amend their arrangements as they can no longer afford their previous payments.

“The Government is going to need to step in with more support for those who simply can’t cope financially due to these enormous price hikes. The question is how best to target and deliver relief to those who need it – we continue to favour an early uprating of benefits, and additional ambitious support to meet the scale of the crisis that many households will face.”


Citizens Advice has posted a useful blog. 45% of callers to National Debtline have a deficit budget where they already do not have enough coming in to cover essential costs. The Charity is calling for urgent targeted support for people caught at the sharp end of this crisis to help them afford energy bills this winter.


FCA publishes webpage for firms around cost-of-living crisis support

See also  DEMSA update 14/5/2022

The FCA has published a webpage with the relevant publications, letters, updates, news and speeches referencing their expectations around tailored support during the cost-of-living crisis. This includes the portfolio letters to mainstream consumer credit providers and regulated debt advice providers from June 2022.

The publication of the Consumer Duty (PS22/9 & FG22/5) at the end of July 2022 has brought transformation planning into sharp focus with the first planning milestone falling at the end of October 2022, which will need to take account of all the portfolio specific correspondence referenced. The webpage references the vulnerability guidance (FG21/1) and the FCA advice to consumers who are experiencing a change in financial circumstances due to the increased costs-of-living.

With a data-driven and outcome-focused regulator, it is important that firms are able to identify customer segments most at risk. This can be using a combination of ‘own’ data and third party information, including transactional data as we have seen a rise in credit usage. Even simple and inexpensive checks against resources like the Vulnerability Registration Service (VRS) can provide some peace of mind and evidence of greater monitoring and due diligence (e.g. Know Your Vulnerable Customers – KYVC).

Changes to the Conduct Rules mean that frontline staff training & competence is a critical part of business readiness plans. I am supporting VRS with virtual training events through October 2022 around the transformation from the 6 TCF outcomes to adopting Principle 12 and the underlying rules, notably around the vulnerability guidance. DEMSA is also on the panel at the Vulnerability Summit on 5 October 2022 chaired by Chris Fitch. This is being sponsored by Lantern. Details below under Events.


InBest – expanding coverage to telecom social tariffs

InBest has announced a new feature to calculate the entitlement to telecom social tariffs. Telecom social tariffs are cheaper broadband, phone and mobile deals offered by some providers to people on certain benefits and can save them up to £300 per year.


MoneyPlus Advice seeing 450% rise in support enquiries

I spotted this in Credit-Connect and haven’t had a chance to discuss with Rachael Phillips. Chris Davis, MoneyPlus CEO, said:

“The number of people seeking debt advice due to the rising cost-of-living has more than doubled this year alone. We’re hearing that higher bills are leading some people to pay for everyday essentials, like groceries, on credit cards.”

“When the credit runs out, some turn to debt consolidation loans, and their total debt level just increases.”

“These numbers look to be the tip of the iceberg for the year. Since February, cost of living inquires rose a further 12%, and based on what we’re seeing, we predict a further rise to 20% in October.”


RTL publishes August 2022 stakeholder update

The update reports gathering support for the new Register of Partial Settlements. This includes FinTechs and challenger banks. DEMSA supports this campaign.



BNPL ‘Dear CEO’ letter

I have attached the latest FCA letter. I am not sure why I received one.

Workplace Awareness of Suicide Prevention – WASP UK

Helen Pettifer, David Murphy and others having been doing great work around suicide prevention in the workplace. They’ve just launched their shiny new website at They will be a CIC once the paperwork is sorted.

They’ve got an event coming up on 12 September to mark Suicide Prevention Day. Details at:

Book at:

Cyber-security and cyber-resilience – 6 months on

Just ahead of the March 2022 FCA deadlines around operational resilience (PS21/3), I produced a January 2022 blog for DEMSA around cyber-security and cyber-resilience. In the last 6 months IDentity and Access Management (IDAM) seems to have assumed even greater focus as firms in the public and private sector revisit policies and cyber-security frameworks.

This probably needs to be aligned with Consumer Duty transformation plans for regulated firms by 31 October 2022. This is a really important aspect of consumer protection and the digital engagement agenda is relentless. Consumer education around being cyber-aware is an important financial education objective. Helping retail customers protect themselves is important, as is dealing with the challenges of hybrid working where agents may work from several locations using a range of devices.

I am looking to review progress in more depth as Kevin Still Consulting in the coming months and this forms part of the ‘gap analysis’ as we look at updating TCF policies and internal audit requirements.

See also  DEMSA update: Consumer Duty countdown / MaPS deficit budgets / Social value in debt resolution / Events

Many firms have gone through Cyber Essentials Plus assessment processes when the standards were enhanced earlier this year. DEMSA also covered the ‘Captains of industry cyber resilience survey’ from November 2021. The government published the ‘Cyber security breaches survey 2022’ in July. I have attached an infographic for small firms. There is one for charities and firms of different sizes.

This follows on from the UK Finance Blog last week around more robust identity and verification.




There is no getting away from it. ESG is on everyone’s agenda and the FCA has flagged this very strongly in the announcement that they are looking for external experts to help shape its work on ESG issues. They are establishing a new advisory committee to the FCA’s Board to work on Environmental, Social and Governance (ESG) issues, and is looking for expressions of interest from stakeholders to join. Get your CV in by 16 September 2022.

I have re-attached my thought piece from March 2022 around board considerations around embedding ESG strategy into transformation plans and this is becoming more acute for regulated firms of all sizes.  




I attended the MorganAsh Consumer Duty event on 25 August 2022. The recording is now available. Don’t be confused by the big picture of Chris Jones from VCX when you click on the link.

My interview with Peter Wallwork of Trustfolio is Tuesday 30 August 2022. I think we have agreed the terms of engagement.  

VRS webinar – Consumer Duty – 21/9/2022

The Vulnerability Jigsaw's Next Piece...'Consumer Duty'

As previously featured, this webinar will cover off some of the tools and solutions available to FCA authorised firms and how help is available to identify the ‘needs, characteristics and objectives of customers’ including those who are vulnerable. We have participants from Aveni, Data on Demand, Delehanty Consulting, IE Hub, MorganAsh, VCX and VRS.   

This is very timely and intended to align with a series of events and training sessions around preparing for the FCA Consumer Duty and some of the grassroots changes required between now and the July 2023, whilst providing full visibility to your transformation plans to the regulator. Helen and I are involved in 4 virtual training events through the course of October 2022, which will be published imminently. These align with some of the tools that we have been working on around PRIN 6 and PRIN 7 being disapplied, including the 6 TCF outcomes. DEMSA provided TCF training, a gap analysis and an annual internal audit process in the transition period from interim to full permissions. This has been updated to reflect the transition to PRIN 12 and the requirements of FG22/5 (non-handbook guidance). I can provide details on this to anyone that is interested.    


Credit Union webinar – 28/9/2022


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Credit Unions have increasingly been in the spotlight, especially with the rise in loan shark activity during the pandemic and the cost-of-living crisis. The Government has promoted Credit Unions as a more cost effective and safer alternative to High-Cost Short-Term Credit (HCSTC) with The Bank of England reporting rising assets and growing member books. This event is timed with the ‘Stop The Loan Shark’ week and we are collaborating with the Illegal Money Lending Team (IMLT). I am taking a back-office role on this event.  

See also  What Every CFO Should Know About Their Collections Department

Following another FCA portfolio letter in March 2022 and the publication of the Consumer Duty in July 2022, this increased profile will bring Credit Union into the spotlight as transformation plans need to be ready by the end of October 2022. At this event, we will discuss some of these challenges, what has been seen in other markets, look at some of the latest data, to see if we can find some ideas and solutions to help the sector. This will be chaired by Chris Warburton, with Heidi Oliver orchestrating everything before, during and after the event.

Under the FCA Consumer Duty, Credit Unions 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. This is likely to sound very familiar to most of the regulated firms on the circulation.

Discussion topics:

  • Increasing market share – has growth stalled, and what is the impact of BNPL – is this a further threat to market share and good customer outcomes
  • Delivering ‘good customer outcomes’ – how will Credit Unions evidence whether these outcomes are being met, including members showing characteristics of vulnerability or with identified accessibility needs
  • Economies of scale – in a battle for customer attention and lowering cost to serve how can Credit Unions create economies of scale by leveraging collective buying power
  • Cost of living / Recession – What will the impact be?  How do stay ahead and get ready for an expected increase in volume
  • Regulatory scrutiny – Further focus from the regulator and what to do to increase and evidence proportionate systems & controls

This is a free webinar targeted at the Credit Union sector for key stakeholders and those holding senior management roles (e.g. SMF1, SMF8, SMF17) in a Credit Union of any size or location in the UK where they are subject to FCA and PRA regulations. It is relevant to other firms supporting this sector (e.g. debt advisers). It is evident that a number of affiliates are active in this space and one that has been raised at creditor liaison forums before.

Speakers include Helen Lord of the Vulnerability Registration Service (VRS), Adam Thornber of Bridgeforce and Mehmet Akseki of Ceverine. Bridgeforce has extensive experience of working with Credit Unions in the US where they work with a third of the Top 30 Credit Unions and representing over $300 billion in assets. Digitisation is a key theme where operating costs are a real focal point.    

Pre-Event Survey: A Credit Union Perspective on Servicing and Collections

Event: Credit Unions: Member Engagement and Debt Resolution is Changing – How to Stay Ahead (and remain in control)

Vulnerability Summit – 5 October 2022

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Vulnerability training events through October 2022

I am looking forward to supporting these Vulnerability Registration Service (VRS) events in October ahead of the first key FCA Consumer Duty milestone of 31/10/2022 and the cost-of-living crisis biting further.

Inclusive design and treating vulnerable customers fairly is a crucial part of the FCA non-handbook guidance (FG22/5) and the vulnerability guidance (FG21/1) needs to be re-aligned to this with PRIN6 and the 6 TCF outcomes being dis-applied by July 2023. KYVC checks need to be reviewed and new KPIs established to be able to robustly answer many of the questions posed by the FCA in FG22/5.

Have a great bank holiday weekend.

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