CM October 2023

INTERVIEW
That needs collective action, not just from
the advice sector but also from the banks
and other creditors. It’s going to take
policy change and other interventions
from the Government and regulators
to solve. This isn’t just about people on
benefits; it’s also about people who are in
full time employment but have no other
means of increasing their income.”
The figures Vikki shares from the
charity’s recent Impact Report show
the value she believes that StepChange
delivers. In 2022 it reached more than 2.8
million customers, 167,000 received full
debt advice and c178,000 clients had an
active debt management plan. Its clients
repaid more than £371m in debt, and
25,500 became free form problem debt
entirely. It recorded more than six million
visits to its website.
Future funding
To what extent StepChange will be
able to continue to help clients at the
current rate – c15,500 per month (as at
July 2023) – will be a challenge, not least
because of a question mark over future
funding. StepChange is currently funded
predominantly through a Fair Share
Contribution, a funding model whereby
creditors who receive a payment from
one of their customers on a StepChange
debt management plan pay a percentage
contribution for the charity’s service,
based on the payments they receive.
“What we are seeing,” Vikki explains, “is
that the pressure on household incomes
means there are fewer people with any
level of repayment potential coming
for debt advice and depositsare also
reducing for those who are already on
debt management plans because their
budgets have been further impacted by
the cost-of-living crisis. As our funding is
linked to that one solution, our funding
therefore tends to be squeezed.
“That said, we are having very positive
conversations with our existing funders
about other ways of supporting us to
support their customers where a debt
management plan might not be available
or might not be the best outcome for
them.”
Vikki says that the charity’s relationship
with the debt purchase sector is probably
the strongest it has ever been. The
increase in debt sale activity in recent
years means that a large proportion of
StepChange’s debt management book is
with the debt purchasers rather than the
banks, which means it is disbursing a
significant amount of money to the debt
purchase sector. Funding is contractual in
most debts sales and that instantly creates
an important relationship between the
two parties. “We work closely with them to
provide the level of information they need
about their customers, and the feedback
we receive from the major purchasers
we work with is that the ‘stickability’ of
our debt management plans are very
strong,” she says. “That is obviously
a benefit to the purchaser and their
customers, since their customers will
ultimately become debt free more
quickly.” Vikki says she works hard to
maintain those relationships: “I have
seen practices within the collections
and purchasing sectors significantly
improve during my time with the charity.
Regulation has had a strong hand in that,
of course, but we also see good practice in
terms of customer service and a focus on
consumer outcomes.
“There was a regulatory sea change
ahead of the pandemic,” she continues,
“and then there was a sea change during
the pandemic, and how much more
a creditor could do before referring a
customer on for additional support.
“Leading the
development of
new products and
services. I loved the
hustle and bustle of
the contact centre
environment but
also knew that my
future career had to
be in leadership.”
Brave | Curious | Resilient / www.cicm.com / October 2023 / PAGE 14