DRF has a comprehensive track record since 2012 in debt research.
Debt Managers' client outcomes shows creditors are getting tougher
- Creditors “tougher” on people who owe money
- Households less able to handle debts
- High customer satisfaction with fee charging debt advice
Creditors are taking a much tougher line with problem debtors who are trying to sort out their financial difficulties, new research from Debt Resolution Forum (DRF) shows.
“Once borrowers try to enter a debt solution, creditors are increasingly taking this as a signal to demand repayment.” says DRF chairman, David Mond.
Rising numbers of troubled borrowers are complaining of calls or visits at unreasonable hours and of notices of legal action once the borrower has sought advice, with a rise also in complaints about higher interest and other charges being levied at the same time.
Elsewhere, DRF’s research shows that “debt resilience” is in decline as UK households are becoming less able to handle their debts as a result of rising living costs. This means they are seeking help at lower levels of indebtedness than had previously been the case.
More encouragingly, problem debtors are increasingly shopping around for the best advice, often via the Internet, and the research showed high levels of optimism as to people’s ability to get on top of their debt problems – about two in five of those questioned described their borrowings as negligible or zero, despite their having sought advice.
The research found also consistently high levels of customer satisfaction with the paid-for debt advice sector, with clients scoring their advisers more than eight out of ten on key questions such as whether they had the client’s best interests at heart and whether they clearly explained the available debt solutions.
The report was undertaken by independent research co-operative Zero-credit on behalf of the Debt Resolution Forum, the professional representative, standard-setting and training body for paid-for debt advisers.
Full Reports
DRF Client Survey D & FC Report
First published: May, 2014
Zero-credit commissioned independent research
More equal than others? How different groups of debtors are coping in post-recession Britain
Creditors and women
Women are more likely than men to face increased charges and receive calls or visits from creditors at unreasonable times. They are also twice as likely as men to use Debt Relief Orders, the ‘quickie’ insolvency procedure for people with low incomes and few assets.
Creditors and ethnic minorities
Minority ethnic debtors were twice as likely as white UK debtors to face legal action even after entering a debt-solution scheme and had higher debt to income ratios.
Creditors and the long-term ill
And creditors showed a lack of forbearance to those with long-term health problems.
Creditors and the over 60s
By contrast, creditors seemed more understanding when dealing with people aged over 60 years than those aged below 60.
Paid-for debt advice
The research found high levels of satisfaction with the paid-for debt advice sector. Those questioned scored their debt advisors nearly nine out of ten in agreement with the statement that they ‘had my best interests at heart’, and nearly 80 per cent reported an improvement in managing their money after signing up to a debt solution.
The research was carried about by independent research cooperative Zero-credit on behalf of The Debt Resolution Forum, the specialised trade body for debt advisors.
Creditors such as big banks and credit card companies insist they treat all struggling debtors equally in terms of seeking a solution that is fair, equitable and sustainable. But a major new piece of research suggests that different social groups cope very differently as they grapple with their debt problems.
The research found high levels of satisfaction with the paid-for debt advice sector. Those questioned scored their debt advisors nearly nine out of ten in agreement with the statement that they ‘had my best interests at heart’, and nearly 80 per cent reported an improvement in managing their money after signing up to a debt solution.
The research was carried about by independent research group the cooperative Zero-credit on behalf of The Debt Resolution Forum, the specialised trade body for debt advisors.
Full Reports
Demographics Executive Summary
First published: July, 2013
Zero-credit research including client outcomes in Free to Fee and Free to client outcomes
Please find the four reports:
DRF outcomes: 2012 client survey – demographics & financial circumstances:
This is a deeper exploration of the demographic characteristics of the people DRF members help.
This report tells you a lot about the people we deal with and will, I am sure, help members improve their service offerings.
DRF research: free to fee outcomes:
This study explores why people chose to come to a DRF member after first seeking free debt advice.
This important report shows that many people are active advice seekers who carefully consider their choices before opting to pay for debt resolution.
There is a clear view that some people feel they should pay the full cost of debt advice and that many think fees are necessary.
It also shows that lack of a halt to creditor pressure is a major reason for moving from free to fee-charging solutions.
DRF research – free-to-client outcomes:
This report shows that most are very satisfied with free advice services.
It also shows that referral by creditors to free advice agencies may be rarer than commonly thought and that debtors are fearful of creditors: some debtors take comfort in advice that token payment schemes are acceptable.
Clients of free advice agencies seem less knowledgeable and less likely to shop around than clients of fee-chargers or those that move from free to fee advice.
DRF research – dmp dropout outcomes:
This study looks at why clients leave DRF members.
It shows that clients that drop out of DMPs often do nothing more to solve to their debt problem, even with a free advice provider.
But it also shows that many appear to have achieved better financial capability and feel able to deal with their debt themselves.
It also shows that many will move from a fee-charging DMP to an insolvency procedure (e.g. IVA) without seeking free advice – even though they are aware of it.
Full Reports
DRF outcomes: 2012 client survey – demographics & financial circumstances
DRF research: free to fee outcomes
DRF research – free-to-client outcomes
DRF research – dmp dropout outcomes
First published: April, 2013
2012 Reports
The full dataset of anonymised raw data from DRF’s research programme with the DebtSector community:
In December 2011, the Debt Resolution Forum commissioned Zero-credit to complete three parallel research studies to explore the outcomes of fee charging debt solutions.
These were an analysis of:
