Debt news: page 2
- January 2025
Debt Advice and Information Package required for diligence on the dependence warrants
From 20 January 2025 creditors in Scotland must give a Debt Advice and Information Package before applying for a warrant for diligence on the dependence, under rules covering enforcement against debtors.
- December 2024
CfRC report finds MaPS debt need estimate excludes 5 million people
The Centre for Responsible Credit says the Money and Pensions Service method for counting people who need debt advice leaves out 5 million people, in a report published on 3 December 2024.
'Lack of control over finances' overtakes 'cost of living increase' as main reason for debt among StepChange clients
StepChange says a lack of control over finances overtook the cost of living increase as the main reason for debt among its clients in December 2024, the first change since June 2022.
Ofgem announces consultation on debt support scheme
Ofgem has announced a consultation on a debt relief and repayment matching scheme, set to launch in 2025, alongside a consultation on improving debt standards for energy customers.
- November 2024
FCA rules for borrowers in financial difficulty come into force and TSG withdrawn
The Financial Conduct Authority's final rules on protecting borrowers in financial difficulty took effect on 4 November 2024, replacing pandemic-era guidance with Handbook requirements for lenders.
FCA updated CONC 7.2 arrears and default rules and guidance
The FCA Handbook's CONC 7.2 section on arrears and default policies was last updated on 4 November 2024, covering arrears procedures, vulnerable customer treatment and policy review.
Rules on forbearance, sustainable repayment arrangements and repossession as a last resort took effect
FCA rules requiring lenders to show forbearance to borrowers in or approaching arrears, to agree sustainable repayment arrangements and to treat repossession as a last resort took effect on 4 November 2024.
FCA firms required to engage early with customers in payment difficulty
Consumer credit firms have been required since November 2024 to engage early with customers in or approaching payment difficulty, under rules cited in a new review of problem debt and homelessness.
- September 2024
September 2024 survey shows rise in arrears among Universal Credit residents
A National Housing Federation survey of housing associations found total rent arrears on Universal Credit claimants' accounts rose 11 per cent to £63m in September 2024, while arrears for residents paying by other means fell 19 per cent to £25m.
- June 2024
Bankruptcy and Diligence (Scotland) Bill completes Scottish Parliament passage
The Bankruptcy and Diligence (Scotland) Bill completed its passage through the Scottish Parliament on 6 June 2024, requiring Scottish Ministers to create a moratorium on debt recovery against people with a mental illness.
June 2024 survey records £57m of arrears on Universal Credit tenants' accounts
The National Housing Federation's quarterly survey for June 2024 recorded £57m of rent arrears on Universal Credit tenants' accounts, with 51% of residents paying by Universal Credit in arrears.
- May 2024
Automatic referral to Small Claims Mediation Service for defended money claims
Defended money claims under £10,000 issued on or after 22 May 2024 are automatically referred to the Small Claims Mediation Service, though claims started online before 5 November 2024 are excluded.
DWP announces enhanced notification strategy for potential overpayments
The Department for Work and Pensions has announced an enhanced notification strategy for potential benefit overpayments, exploring targeted texts or emails to alert claimants, amid scrutiny of Carer's Allowance repayments.
Mortgage arrears among StepChange clients up three percentage points year on year
StepChange reports that 18% of its clients responsible for a mortgage were in arrears in May 2024, three percentage points higher than the 15% recorded a year earlier.
- April 2024
Fair Repayment Rate comes into force
The Fair Repayment Rate took effect on 30 April 2024, capping deductions from Universal Credit at 15% of the standard allowance, down from the previous 25% limit.
StepChange debt advice demand up 11% year on year
StepChange says 16,046 clients sought debt advice in April 2024, 11% more than the 14,512 who did so in April 2023, as demand for advice continues to rise.
- March 2024
Energy bill arrears reach highest level since records began in 2012
Resolution Foundation research published on 3 March 2024 finds UK consumer debt at its lowest since at least 1999, but energy bill arrears at their highest since records began in 2012.
Resolution Foundation research finds UK consumer debt at lowest level since at least 1999
Resolution Foundation research published on 3 March 2024 finds UK consumer debt at its lowest level since at least 1999, down from 23% of household disposable incomes in the mid-2000s to 13%.
UK regulators publish joint debt collection statement
The FCA, Ofgem, Ofwat and Ofcom published a joint debt collection statement in March 2024 setting out four outcomes they expect firms to deliver, as energy debt in Great Britain reached a record level.
- February 2024
Resolution Foundation publishes briefing note on household debt in the cost of living crisis
The Resolution Foundation finds consumer debt at its lowest share of household income since 1999, while arrears on gas and electricity bills reach their highest level since 2012.
DWP confirms changes to CMS enforcement sanctions
The Department for Work and Pensions has confirmed that the Child Maintenance Service will be able to impose enforcement sanctions directly, without applying to the courts, and will scrap its £20 application fee.
- November 2023
Welsh council leaders commit to accredited enforcement firms only
All council leaders in Wales have committed to using only accredited enforcement firms to collect Council Tax, making Wales the first UK nation to do so, according to the Welsh Government.
- October 2023
Help to Repay findings published
The Money Advice Trust has published findings from October 2023 showing 6.4 million UK adults behind on energy bills, and is leading a coalition of charities calling for a temporary Help to Repay scheme.
Households in serious financial difficulty rise to 4.8 million
The number of UK households in serious financial difficulty rose from 2.8 million in October 2021 to 4.8 million in October 2023, according to a survey tracking household finances.
- June 2023
Cost of living increase remains most common reason for debt at 26%
The cost of living increase remained the most common reason for debt among new StepChange clients in June 2023 at 26%, down one point on May but eight points above June 2022.
Council tax and water arrears among clients rise to 33% and 23%
The share of StepChange clients behind on council tax rose to 33% and on water to 23% in June 2023, both up two percentage points on May and back to levels last seen in March.
FCA prohibits debt packager remuneration from debt solution providers
The Financial Conduct Authority has banned firms from taking commission, fees or other payment from debt solution providers for referrals, under a rule that took effect on 2 June 2023.
Mortgage Charter protection against quick eviction
Lenders covering 85% of the UK mortgage market have committed to a charter that stops them forcing borrowers out of their homes within a year of a first missed payment.
- May 2023
Cost of living increase remains most common reason for debt among StepChange clients
StepChange reports that a cost of living increase was the most common reason for debt among its clients in May 2023, cited by 27 per cent, up from 16 per cent a year earlier.
Dual fuel bill arrears among StepChange clients up six percentage points since January 2023
StepChange reports that 57% of clients responsible for dual fuel bills were in arrears in May 2023, six percentage points above both January 2023 and May 2022.