Industry Thoughts

Weighing in at 168 pages, the Government’s 10 Year Health Plan for England is a somewhat intimidating document. But among its 71,000 words, are a couple of sentences which will interest anyone in the consumer credit industry. The plan proposes the establishment of a Neighbourhood Health Centre (NHC) in every community. The first will be established “in the places where healthy life expectancy is lowest” – these are of course most likely to be poorer communities – and will be a “one stop shop”, open at least twelve hours a day and six days a week, offering a range of co-located NHS, local authority and voluntary sector services.

Now more than ever, there is an increase in regulatory scrutiny and a shift in consumer expectations, leading to a transformation in communication within the credit and collections sector. Central to this is conversational AI, which is transforming the way creditors interact with customers, particularly those experiencing financial difficulties.

We’re excited to join this year’s CCTA conference, offering us the opportunity to share more about how StepChange helps members and customers through financial challenges. While over 171,000 people received debt advice from us in 2024, that’s only one part of our broader, more comprehensive support system. We’re not just about one-time fixes, our focus is long-term help, built on meaningful relationships and sustained outcomes.

Amid continued economic uncertainty and an unexpected inflation rise to 3.9% in January, many UK residents are turning to borrowing to help manage their money and make ends meet. In fact, our research found that one in five UK adults – approximately 11 million people – now consider themselves financially vulnerable and at risk of harm due to their personal circumstances, including poor health, life changes like new caring responsibilities, or difficulty handling financial or emotional stress.

The digital space is where consumer credit providers win or lose. In the race to optimise websites, many turn to AI-powered content tools. These promise quick SEO gains and effortless content creation, but relying solely on AI can be a costly mistake. Here’s why human expertise remains crucial for building trust and engagement.

Unsecured debt in the UK reached an average of £4,287 per adult in 2024, marking a troubling trend as household debt has steadily risen over the past two decades. With household debt now exceeding £2 trillion, its impact extends beyond finances, deeply entwining with mental health challenges.

Equifax launched its second annual Environmental, Social & Governance (ESG) report in February, highlighting the continued importance as part of its business strategy.

For many lenders, the affordability assessment process is still weighed down by long application forms and manual reviews from underwriters, leading to long processing times. Brandon Wallace, Product Manager at Bud, explains how enriched transaction data can help lenders to cut costs and scale efficiently, in addition to increasing approval rates and reducing risk.

As the financial services industry transitions to a digital-first world, responsible lending must evolve to meet new expectations for fairness, transparency, and customer-centricity. Digital transformation is reshaping how lenders engage with customers and manage their portfolios, enabling more effective, data-driven lending practices that enhance both the lending and collections processes, promoting better customer outcomes while upholding financial responsibility.

As firms continue to assess the findings from the FCA’s review of the fair treatment of customers in vulnerable circumstances, we explore a critical challenge many firms face: effectively monitoring outcomes for vulnerable customers.

Last summer we helped several clients with their Consumer Duty board reports (required under PRIN 2A.8). Since the creation of the first suite of reports, the FCA has reviewed a sample and published findings, highlighting good practices and areas for improvement. We have set out six top tips based on the FCA’s output and our own observations.

The FCA’s review into discretionary commission arrangements, together with the outcome of the Supreme Court’s review of a landmark Court of Appeal ruling regarding motor finance commissions could have widespread consequences for the motor finance sector.