The individual behind the statistic: CAP clients’ experience of debt collection
Anytime I receive a call from an unknown number I have a quick mental debate as I rack my brain for an explanation of who might be calling, what they could want and whether it’s worth picking up. It often instigates a brief moment of panic, despite it most likely being an unwanted cold call. For many of CAP’s clients, however, this is not necessarily the case and the simple act of answering a call can feel utterly terrifying as they fear what the voice at the other end may say.
Latest CAP data reveals
CAP’s 2022 client survey has shed light on the challenges facing our clients and the negative experiences they have faced with debt collectors and creditors. The data shows that these interactions have heightened their emotional and financial struggles. Four in five (80%) respondents experienced increased anxiety or stress because of their interactions with creditors and debt collectors. This is a considerable number of people whose problems with debt and destitution are being worsened because of their experiences navigating these creditor relationships. Two thirds (66%) of respondents have stated they fear opening the post while three in five (60%) fear answering the phone. These statistics prove that for the majority of our clients, virtual and written interactions with creditors and debt collectors are anxiety inducing.
Living in fear
The data shows that many people experiencing problem debt are living in fear. They may be living alone, or a parent struggling to provide for their family, and there is a clear need for creditors to remember the human being behind each statistic rather than focussing solely on the money owed. One in four (25%) respondents received phone calls or texts from their creditor everyday, and over one in ten (13%) were visited at their home. Fears of this behaviour can contribute to, and exacerbate, dangerous cycles that leave individuals retreating and cutting themselves off from support networks and means of receiving help. This persistent behaviour, though not impacting all clients, explains their stress associated with answering the phone or front door. There is a person behind each number on a call list for whom the thought of an unknown number calling could be utterly paralysing. Ironically, these measures to engage people in debt and retrieve money owed are counterproductive in helping resolve debt as clients become more likely to cut themselves off.
What can creditors do?
When asked ‘Considering the creditors you interacted with before CAP’s help, what could they have done to better support you?’ less than one in ten (8%) of the comments said there was nothing they could have improved on with one client claiming ‘nothing, they did all they could to help.’ Also, nearly a third of respondents (31%) were told where they could seek debt advice and thus had their struggles practically acknowledged. However, just less than half respondents (42%) called for better customer service, whether that be more sympathy, offering help or not making threats. Many of these responses explicitly asked for creditors to ‘be more understanding and treat cases individually’. This is key as each case is a different client with their own lived experiences and circumstances. Clients are asking for an attitude of empathy and to be heard as they try to navigate solutions together. One client has said ‘they made me feel depressed and could of been a little more sensitive about my situation, which they knew about.’ These attitude changes may seem small and may take a couple more minutes in each call, yet could be the difference between a client feeling able to communicate and work with these companies and hiding away from them.
The FCA’s latest financial lives survey found that ‘less than half of UK adults had confidence in the UK’s financial services industry’ and just ‘36% agreed that most financial firms are honest and transparent in the way they treat them.’ This further reinforces the need for change to better support the consumer. One simple way for creditors to better support clients, to help them feel heard and acknowledge the complex realities of their struggles, would be to use their voices to provide advice and signpost to debt advice agencies. This will enable creditors to play a significant role in helping people seek help, rather than exacerbating their struggles. Just think of the difference that could be made to these individuals’ lives if firms were to review the frequency of their communications or start regularly signposting customers to the MaPS Money Helper website. It could become the beginning of an individual or family’s journey out of problem debt.
This blog has been written by Zanna Meynall from CAP’s Strategy and Insight team.
