Freezers and financial difficulties

I was in Tesco to pick up a few things this Sunday and in the middle of picking some snacks for later, my attention was drawn to a hubbub at the end of the aisle.

Lots of people, all waiting, without a semblance of a queue, for the arrival of the day’s wave of discounted, sell by to-day food to come out.

In due course it did, and there then followed a mild and polite scramble as people picked up the bargains.

Listening closely

Now I am not a stranger to the discount aisle. In fact, it is a great place to pick up a good food bargain, especially ones to pop in the freezer for later.

Now, we have all noticed the cost of living increase in the last couple of months, not least with grocery expenses, but this was something I had not seen before… at least not in these normally reasonably comfortable surroundings.

My take away, the cost of living is clearly starting to bite, and in new parts of the population too.

During the preparation for our recent audience with Credit Unions, I heard similar comments too. They had seen similar developments.

Customers who were previously financially stretched, are still financially stretched. They are used to budgeting and finding savings and there is some support available to help with getting by.

… for a new profile

However, as this latest cost of living crisis bites, they are also starting to see a new profile.

Customers a year ago who were managing, are now also having to absorb energy and food cost increases. They have never had to budget like this before, are not used to it, struggling and starting to look for help… it is something new and a surprise for many.

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In the risk profile population graph, it is like we are all taking a step to the left, increasing in risk profile, away from prime and to be ‘riskier’… it affects all of us differently and is a creeping change, gradually enveloping more and more of us as prices filter through.

With reports that arrears levels still not spiking, it is likely the impact of the cost of living crisis will not hit us with a bang as much as a slow-creeping fog… but, if you look closely the signs are already there and starting to be seen.

... & help with debt advice

In this budgeting and advice are going to be needed more than ever, which is clearly going to put more pressure on the debt advice sector… in the news this week, with the announcement of the MaPs contracts.

With the debt advice award not including a couple of the largest free debt advice providers, who handle a lot of the existing volume, it was a bit of a surprise. It will be interesting to see how this plays out… this could precipitate a big change.

With support for customers and help for those in need going to be more important than ever… an already delicate balance between customers, debt advice providers and creditors will for sure need to be handled with care… one to watch closely the next couple of weeks (and no doubt more to come on this topic too).

Have a good week everyone.


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