Money Advice Service working with creditors: What this means for you
The Money Advice Service has released a new creditor toolkit to help creditors support customers in debt. Both creditors and debt advice agencies have worked with the Money Advice Service on this toolkit to ensure better and more consistent creditor practice.
The toolkit – Working collaboratively with debt advice agencies – should hopefully mean that customers in debt get the support they need. And if a customer needs help from a debt advice agency, the creditor should assist them every step of the way.
We’ll take you through what the creditor toolkit covers and how it should help if you fall into arrears.
What is the Money Advice Service creditor toolkit?
If you’ve ever fallen behind with your debt repayments, you’ll know how stressful this can be. And if a creditor treats your unfairly or chases you repeatedly for the debt, this can make the situation worse.
That’s why the Money Advice Service has created this creditor toolkit – to make sure all creditors are treating those in debt fairly.
Of course, many creditors already work with debt advice agencies to support customers who get into financial difficulties. What this toolkit should do is ensure that all creditors do this.
According to the Money Advice Service creditor toolkit, creditors should:
- see how debt advice can help you if you’re in arrears,
- use the Standard Financial Statement when you apply to borrow money,
- help customers who are struggling to access debt advice services,
- monitor how debt advice agencies help customers,
- speak to debt advice providers daily,
- identify customers who need specialised debt advice intervention, and
- meet the Money Advice Service best practice guidelines for ‘Supportive Creditor Standards’. The research shows that if customers have access to debt advice, they’re less likely to fall behind with the payments. When they do go into arrears, they also owe less and are more likely to recover.
What does it mean for you?
So if you’re struggling with meeting your contractual payments, this new creditor toolkit could help. It should mean that all creditors will work towards the same standards to treat you fairly when you fall behind.
Speak to your creditors as soon as you realise that you’re having problems. We know this can be scary but getting in touch with them as early as possible can actually help the situation.
You might be able to arrange a new repayment schedule or a payment break until you get back on your feet. Most creditors should be responsible lenders and will look to support you – and to make sure your debt is affordable for you.
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