Consumers keep lenders in the dark about financial woes

Nearly 70% of people who experience a sudden, significant impact on their finances never contact their bank or building society about their financial difficulties, say Callcredit.

Related topics:  Finance News
Millie Dyson
2nd September 2010
Latest News
69% of adults suffering from financial pressures over the past two years admit to failing to speak with their bank or building society about their financial difficulties, and 42% have not come completely clean about their financial situation when problems arise.

The results reveal that two thirds of British adults (65%) have experienced some form of sudden change in their finances during the last two years, particularly those with children (74%).

Only 8% contacted Citizens Advice or a debt charity when they first received the bad news - the same percentage as those who contacted their own bank or building society - leaving the vast majority of lenders ignorant of their possible debt stress and unable to offer support.

Of those that did contact their bank or building society in the long term, 8% admitted they were not completely honest with them about their financial situation.

The results highlight that 24% of people who said they had suffered an unexpected financial shock over the past two years had seen their income suffer - with 6% taking a pay cut, 9% seeing a cut in working hours and 9% losing their job.

Graham Lund, Managing Director of Callcredit, said:

"These figures are extremely worrying. What's particularly concerning is the number of people who fail to make their bank aware of sudden changes in their financial situation - and those that do get in touch aren't always completely honest.

"It's therefore extremely important that financial service providers use information and tools available to proactively monitor any changes in their consumers' financial situation and have sight of the bigger picture."

Graham Lund, Managing Director of Callcredit continued:

"It's imperative that lenders help customers identify any issues as soon as possible in order to support them in managing their finances. Callcredit has a range of affordability solutions that provide an early warning system and support for customers approaching the limits of their affordability, and assesses their ability to repay their debt.

"Callcredit's CallMonitor is also the first service in the UK to provide daily customer profile triggers, which enable lenders to identify those customers who are most at risk of being overburdened with credit as soon as they get close to their limits."
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