Debt collection the only credit activity to see a fall in complaints
18 February 2019
The Credit Services Association (CSA), the voice of the UK debt collection and debt purchase sector, has reacted with disappointment to inaccurate reporting of recent complaint statistics into debt collection activities.
It believes that negative stereotyping and media bias has allowed debt collectors to be singled out to make a headline, conveniently ignoring the fact that complaints against debt collectors have in fact fallen in the last 12 months, and represent only 0.0021% of the 50,000,000 accounts handled by CSA members.The figures from the Financial Ombudsman Service (FOS) show that there were 998 complaints regarding debt collection activities in 2017/18, but less than a third (29%) were upheld.
The CSA believes a 3% fall in complaints against debt collection should be seen in the context of an 83% increase in complaints against credit reference agencies, a 73% rise in complaints against hiring, renting and leasing businesses, and a 64% increase in complaints regarding payday loans (17,256 complaints in 2018 versus 10,529 in 2017).
They should also be seen in the context of rising complaints in other areas such as pet and livestock insurance (1,508 complaints representing an increase of 38% year on year) which suggests that consumers are more likely to complain about insuring their pets than the way in which a debt is collected.
“The decidedly small, and indeed falling, number of complaints relating to debt collection activities, particularly against a backdrop of rising complaints elsewhere, illustrates the level of commitment from CSA members, and other financial services creditors, to treating their customers fairly when collecting outstanding debts,” says Peter Wallwork, CSA Chief Executive.
“Singling out debt collectors in this way fails to take into account the significant progress the industry has made in the last ten years, especially in the identification and treatment of vulnerable customers, work that has been acknowledged by the regulator, the Ombudsman, and the various debt charities.”
Mr Wallwork also says it is important to understand that the total number of complaints relates to debt collection activities as opposed to debt collection agencies per se: “This means it includes complaints raised against in-house collections teams within banks and other financial services institutions.
“Whereas the CSA accepts that any complaint is one complaint too many, failing to provide proper context does the agencies a considerable disservice in the work that they do in treating customers fairly, helping them to become debt free, and returning significant sums to the UK economy.
“Some creditors outside of financial services might indeed benefit from following the CSA’s Code of Practice which has been widely acknowledged as delivering significant levels of improvement in the treatment of potentially vulnerable consumers by the debt collection industry.