What you need to know this week
- The government is considering targeted action in the next Budget to tackle cost-of-living challenges, potentially including cuts to the 5% VAT rate on energy.
- UK manufacturing output grew by 0.7% in August 2025, contributing to slight national economic growth.
- Debit card transactions in July 2025 fell year-on-year by 0.7%, while credit card transactions rose 2.4%.
- The National Cyber Security Centre (NCSC) recorded 204 nationally significant cyber-attacks in the past year, more than double the previous 12 months.
- GamCare’s Money Guidance Service evaluation highlights the financial harm link between gambling and debt, showing 76% of helpline users face financial difficulties.
- Registry Trust data show over 5.2 million live judgments, with consumer judgments up 11% quarter-on-quarter.
- HMRC is rolling out Microsoft 365 Copilot across 32,000 staff in 2025, increasing to 50,000 in 2026.
- The FCA has issued follow-up communications on Fair Value Assessments (FVAs), highlighting the need for robust MI, vulnerability assessment, and product outcome monitoring.
- The next Debt Buyer, Debt Manager and BPO event will be held at The Lowry, Manchester, on 4 December 2025.
- Individual insolvencies in England and Wales reached 11,101 in September 2025, up 7% year-on-year.
- Collaboration between energy suppliers and debt advice providers is increasing, with Ofgem-backed research calling for coordinated referral pathways and data sharing.
- Vanquis launched a benefits checker powered by InBest AI, helping customers identify unclaimed benefits.
Key Themes
Economic and Cost-of-Living Pressures link
Energy bills rose by 2% under Ofgem’s latest cap, prompting government consideration of VAT cuts and targeted measures in the next Budget. Manufacturing growth of 0.7% in August reflects tentative economic recovery. This is relevant for creditors and debt managers as rising energy and living costs continue to influence disposable income and arrears levels.
Consumer Spending and Credit Trends link
UK Finance data show a mixed picture: debit card spending fell while credit card use and outstanding balances grew by 7.5% year-on-year. Contactless payments accounted for 78% of debit card and 67% of credit card transactions. These indicators inform affordability assessments and highlight potential credit dependency risks.
Cybersecurity and Fraud Risk link, link, link
The NCSC handled 204 major cyber incidents in the past year, showing the growing threat landscape. Financial institutions and debt collection agencies should prioritise cyber resilience and consider the NCSC Cyber Essentials scheme with free insurance options.
Gambling, Debt and Financial Vulnerability link, link, link, link
GamCare’s Money Guidance Service report highlights the overlap between gambling harms and financial distress, with participants reporting improved stability and reduced debt through tailored support. This insight is critical for creditors and advisers managing vulnerable consumers affected by gambling-related debt.
Credit Judgments and Financial Rehabilitation link, link
Registry Trust recorded 316,683 new judgments in Q3 2025, up 11% year-on-year. Only 0.6 million are marked as satisfied. Advocates are calling for mandatory satisfaction reporting by bulk claimants to support credit repair and consumer rehabilitation—important for lenders and collectors addressing persistent credit file damage.
AI and Digital Transformation link, link
HMRC’s Microsoft 365 Copilot rollout (32,000 users in 2025, expanding to 50,000 in 2026) represents the UK Government’s largest AI adoption to date. The initiative targets a projected 2 million hours in annual productivity savings and emphasises responsible AI principles—an approach relevant for firms exploring automation in customer and compliance functions.
FCA Fair Value Assessment Review link, link, link
The FCA’s review of Fair Value Assessments stresses consistent fee rationales, vulnerability consideration, outcome benchmarking, and cohort-based MI. Firms must integrate these into 2026 Duty reports. The findings underline the importance of transparent pricing, vulnerability assessment, and ongoing monitoring for compliance and consumer trust.
Sector Collaboration and Data Sharing link, link, link, link
Collaboration between energy suppliers and debt advice providers is increasing, with Ofgem-backed research calling for joint referral pathways and data passporting. Adoption of the Standard Financial Statement (SFS) and consistent acceptance of repayment offers are key recommendations. Improved cross-sector cooperation is critical for managing rising essential service arrears.
Insolvency and Breathing Space Trends link
September 2025 saw 11,101 individual insolvencies in England and Wales (up 7% year-on-year). DROs remain high, and StepChange registered 59% of all Breathing Spaces since 2021. These figures reflect sustained financial distress and ongoing demand for debt solutions.
Upcoming Industry Events link, link, link, link
Key sector events include the Debt Buyer, Debt Manager and BPO conference at The Lowry, Manchester (4 December 2025), and the Enforcement Sector Collaboration Event in London (27 November 2025). These events will cover data sharing, vulnerability standards, and technology adoption.
Technological Innovation in Customer Support link, link
Vanquis launched a benefits checker powered by InBest AI, following a successful pilot with Fair Finance. Over £17m in benefits have been identified since December 2024, showcasing AI’s potential to enhance customer financial resilience and reduce arrears risk.
Future of Debt and Enforcement Collaboration link
CIVEA and the National Support Network (NSN) are developing joint standards for vulnerability and ability-to-pay assessments. This initiative, relevant to council tax and enforcement collections, aims to promote more equitable outcomes and consistent treatment of vulnerable individuals.
Key Statistics
- Energy bills rose by 2% under the latest Ofgem price cap.
- UK manufacturing grew by 0.7% in August 2025.
- 2.3 billion debit card transactions and 415 million credit card transactions were recorded in July 2025.
- Outstanding credit card balances rose by 7.5% year-on-year.
- NCSC handled 204 nationally significant cyber-attacks, up from 89.
- Registry Trust recorded 5.25 million live judgments, with 316,683 new judgments in Q3 2025 (+11% year-on-year).
- 11,101 insolvencies were registered in September 2025 (+7% year-on-year).
- 7,684 Breathing Space registrations were made in September 2025 (+12% year-on-year).
- HMRC’s AI pilot projected 2 million hours in annual productivity savings.
- 87% of StepChange clients began their debt advice journey digitally in September 2025.
Newsletter Contents
- Government considers VAT cut to reduce energy bills.
- UK economic growth driven by manufacturing output.
- Mixed trends in debit and credit card spending.
- Surge in cyber-attacks prompts stronger resilience focus.
- GamCare’s Money Guidance Service addresses gambling-related debt.
- Registry Trust data highlights rising consumer judgments.
- HMRC scales up AI adoption through Microsoft Copilot.
- FCA issues updated Fair Value Assessment expectations.
- Debt Buyer and BPO event confirmed for 4 December 2025.
- September insolvency figures show continued financial strain.
- Growing collaboration between energy and debt advice sectors.
- Vanquis and InBest AI support customers in accessing unclaimed benefits.
Find the full DEMSA newsletter, commentary and links here
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