In response to mounting cost-of-living pressures faced by consumers, we’ve collaborated with Ofgem, Ofwat, and Ofcom to outline our collective expectations for firms across various markets.

We’ve united with fellow regulators to advocate for enhanced debt collection practices among firms. This initiative is particularly crucial as numerous consumers grapple with the strain of rising living costs and the looming risk of falling into arrears.

In partnership with Ofgem, Ofwat, and Ofcom, we’ve articulated our collective expectations across markets, urging firms to:

Ensure customers in debt aren’t bombarded with excessive communication. Utilize supportive and empathetic language in their interactions. Clearly guide customers towards free debt advice resources. Facilitate easy communication channels for debt advisers representing clients. These expectations are underpinned by the robust regulatory framework already established in the financial services sector. The implementation of the Consumer Duty further elevates the bar for consumer protection, building upon existing guidance on supporting vulnerable customers and those facing financial hardships.

In instances where firms fall short of meeting our stringent standards, we are prepared to take decisive action.

In 2020, we imposed fines totaling £90 million on firms for deficiencies in their treatment of customers in arrears, with firms disbursing over £570 million in compensations to affected customers.

Additionally, we’ve collaborated with nearly 100 lenders to enhance their approach to assisting customers in financial distress, resulting in almost £60 million in compensations for 270,000 customers.

In order to shield consumers grappling with the cost-of-living crunch, we’ve also:

Issued reminders to 3,500 lenders outlining our expectations for tailored support to borrowers facing financial difficulties. Revised our regulations to align with key commitments outlined in the Government’s mortgage charter, bolstering our guidance on how lenders can assist customers apprehensive about meeting payment obligations. Revamped overdraft charges, yielding nearly £1 billion in savings for consumers. Prohibited providers of debt advice from receiving referral fees from debt solution providers, thereby sparing debt-ridden consumers thousands of pounds in unnecessary fees while ensuring access to superior quality advice. Issued warnings to banks to enhance their treatment of small business owners during debt collection processes. Advised insurers to safeguard customers from unnecessary product offerings or add-ons and unfair penalties.