Tuesday 11th October 2011
Where would we be without fee-charging Debt Management companies?
As news broke this week that the number of Debt Management companies surrendering their licences to the OFT increased to 61 I thought back to a quote I heard at the DRF Conference last week.“It’s arguable that if it wasn’t for the fee charging commercial sector then the debt charities would have collapsed under the volume of enquiries several years ago.”Back in 2009 the Citizens Advice Bureau (CAB) announced they were dealing with 9300 new debt problems a day. I think it’s a fair assumption to predict that this number will only have increased since 2009. I travel past my local CAB every morning on the way to work and regularly see queues of people at 8 o’clock in the morning, if the fee-charging sector was to disappear overnight then these queues would get longer and longer and longer.But what would happen if in fact it was the free sector that was to disappear? As a person in need of help with their finances what kind of service could they expect to receive?When the OFT published its Debt Management Guidance, it announced that 129 companies needed to improve their practices; so far 61 have had their licence revoked or relinquished. This leaves many companies who do provide a quality service and who are operating within OFT guidelines.Industry body the Debt Resolution Forum (DRF) has introduced a qualification that is the equivalent to an A level and accredited by EDEXCEL to ensure levels of competence and knowledge of staff increases.All DRF members are inspected by the Insolvency Practitioners Association – an inspection which checks, amongst other things, that Marketing, Terms and Conditions of business, Call scripts and complaints handling are of a satisfactory standard.They will be charged a fee for the service they are provided.What other credible alternatives to the fee charging sector is there?Without any, the fee charging sector is here to stay. Will a fee charging DM company ever provide a high enough standard of service to gain the respect of the free sector?Facebook campaign targets loan sharks
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