New research from the FCA and MoneyHelper has revealed that many people in financial difficulty are missing out on vital support due to a range of factors including feelings of stigma around financial struggles and not knowing who to turn to get help.
The findings also highlight the importance of reaching out for support, with eight out of ten people in financial difficulty who used debt advice recommending it, and 70% saying it had been more helpful than they had anticipated. StepChange is urging anyone who finds themselves struggling to cope with financial pressures to seek help as soon as possible.
Richard Lane, Director of External Affairs at StepChange said:
“At a time when, as the FCA says, some 15% of the population are in financial difficulty, it’s really concerning that so many of those struggling are not coming forward for the help that they need. While there are rules and guidance for lenders that are designed to ensure those in financial difficulty can access support, our own research found that fewer than one in four of those struggling with repayments are in contact with their bank or creditor, while more than half of GB adults (53%) would be reluctant to seek help with financial difficulty due to concerns about credit scores and fears about the stigma of money worries.
“With the cost of living crisis set to push more and more people into difficulty, it’s vital that everyone who needs support feels able to reach out for help, whether from a lender or from a free debt advice provider. As the FCA’s research shows, those who do reach out for advice have far better outcomes than those who do not.
“It’s also crucial we see effective early interventions that identify and provide those in financial difficulty with a safe, fair way out of unaffordable debt. The new Consumer Duty is a vital opportunity for firms to design products and change practices to ensure those in difficulty get effective help fast.”
Notes to editors
- You can view the FCA and MoneyHelper’s new research here