18 Mar 2024 | Posted In Money advice news

As part of Debt Awareness Week 2024, the UK Regulators Network (UKRC) has published a letter setting out the consumer outcomes that the FCA, Ofcom, Ofwat and Ofgem expect to see firms delivering, in response to identified consumer harms in the context of the cost of living crisis.

The key consumer harms in debt collection identified in the letter are:

  • Customers in financial difficulty feeling they are being inundated by collections communications
  • Use of intimidating or threatening tone in collections communications
  • Advisers working for free debt advice organisations facing unnecessary barriers when engaging with creditors on behalf of their clients

The outcomes the four regulators expect their regulated firms to deliver are identified as:

  • Firms ensure an appropriate frequency of collections communications and reduce the frequency where it is not delivering positive customer engagement or is causing harm to consumers.
  • Collections communications use tone that is supportive.
  • Information about free debt advice and how to access it is clear and prominent in collections communications and ‘warm’ referrals (where a firm refers the customer to another organisation directly so that the customer doesn’t have to make a second call) are used where appropriate to help customers engage with free debt advice as early and easily as possible.
  • Firms make it as easy as possible for advisers from free debt advice organisations to contact creditors and ensure customer service agents are empowered to resolve the issues advisers contact them about.

Each of the regulators has set out rules, guidance and best practice relevant to delivering these outcomes in an annex at the end of the letter. This letter follows on from another joint letter published in June 2023 which set out shared expectations on how firms in their respective sectors should support customers in financial difficulty and committed to considering what the regulators’ shared expectations are in relation to debt collection.

Read more and download the full letter here.