Credit Management January February 2020

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CONSUMER COLLECTIONS HELP OR HINDRANCE? Should the debt collection sector be reaching out to consumers with general advice? AUTHOR – Heather Greig-Smith IN September last year, the trade body for the industry, the Credit Services Association (CSA), embarked on a bold campaign to support the consumer with direct advice. While many in the advice sector have welcomed the move, others have been more reluctant to engage. Despite seismic change in debt collection over the last 15 years, in some quarters stereotypes of these businesses as brutal, uncaring and frightening persist. In reality, agencies today strive to display the opposite: a sensitive approach, working with individuals to establish their financial circumstances and agree payment plans that they can afford. Debt collection businesses can produce ample evidence of the relief their customers experience when they face up to their situation and pick up the phone, often after months or years of ignoring the letters and calls. The frustration is often that things have to hit rock bottom before some individuals will come forward. The issue for the sector has always been in reaching those who are still burying their heads in the sand – how do you convince frightened people to engage before their situation becomes desperate? MOTIVATIONAL SPEAKER The CSA’s #heretohelp campaign is an attempt to do just that. In a five minute-long film, motivational speaker Brad Burton reveals his experiences of problem debt and interviews members of the CSA executive along with consumers who have been through the debt collection process. “I was £25,000 in debt. You don’t believe there’s a way out,” says Brad. The footage is a bid to demystify the process and convince indebted people to contact their creditors. “We wanted to remove the understandable fear and uncertainty that many customers face when in debt,” says Peter Wallwork, CEO of the CSA. “We want to build confidence in debt collection so that whatever their circumstances, people will know that they will be treated with fairness, understanding and compassion. We want everyone to get behind this serious drive to remove the stigma of debt once and for all.” Peter says that combatting poor and misleading advice on the internet, that can often make matters worse and not better for the customer, was a key driver behind the initiative: “It shows our industry and our members at the heart of helping customers who are in financial difficulty,” he adds. In many ways, the debt collection sector is ideally placed to deliver this message, as its members see first-hand the effects of problem debt every day. Highly-regulated and closely managed, teams work with vulnerable people and they know how frightening the unknown can be. Reassuring those afraid to get in touch makes sense. Intrum UK Managing Director Eddie Nott says the film tackles the issues that collections teams know worry customers. “We consistently hear from customers how relieved they are to have tackled their financial problems and that they wish they’d picked up the phone earlier. There is still too much fear and embarrassment around debt – if the film can reassure people who are afraid to get in touch that will reduce their distress as well as helping the industry.” UNCOMFORTABLE VIEWING Of course, the message is also a self-interested one for the sector – ultimately the aim is to establish payment plans and recoup the debts. It may be that this has made some in the broader advice sector uncomfortable about helping to promote the film. ‘‘We’ve had such a positive response from so many in the advice sector, though there are still some who seem less keen to help us spread the message and that is disappointing,’’ Peter Wallwork adds. Those who are positive about the endeavour are happy as long as those in debt receive Advancing the credit profession / www.cicm.com / January/February 2020 / PAGE 28
The issue for the sector has always been in reaching those who are still burying their heads in the sand – how do you convince frightened people to engage before their situation becomes desperate? Advancing the credit profession / www.cicm.com / January/February 2020 / PAGE 29
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Credit Management January February 2020

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