One of the UK’s free debt advice providers, PayPlan, has said it expects to see a huge surge in demand for debt advice when the current temporary relief being offered by lenders in response to the Coronavirus crisis comes to an end.
The FCA called for interest and charges to be frozen on all loans and credit cards to help consumers struggling financially as a result of the pandemic. However, for people who were struggling with debts before the crisis, a delay in seeking advice will only exacerbate their problem.
PayPlan is also urging the government to ensure there is as much clarity as possible around payment dates for those who are self-employed and make access to any interim financial help as easy as possible.
PayPlan’s CEO, Rachel Duffey said:
“We welcome the comments by the FCA, and the help being offered by creditors in these very difficult times. When someone can’t afford their payments it is pointless adding further stress by worrying about debt repayments. However, for anyone with ongoing debt problems it is still often worth seeking financial help.”
“Debt repayment plans can be very flexible. Where creditors know that one of their clients is struggling, they will allow them to pay small amounts now and then increase payments to suit their circumstances. This is particularly relevant for anyone who is receiving an income but at a reduced rate.
“We’re seeing high volumes of people coming to us which means that we can advise them on the best course of action to get their finances under control. What we’re more concerned about is how we can help those people who do not know where they currently stand. We’re finding that self-employed people and small business owners are still very worried about the ambiguity surrounding their income.”
While there has been more immediate support offered for employees, many self-employed people are having to survive on the standard weekly rate of Universal Credit until their Income Support payment comes through from HMRC in June, and some local councils have not yet released the information needed for small business owners to claim the grants they’re entitled to.