Debt advice that may leave you owing even more money — SkimNews
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- Lenders told the Bank of England they expect unpaid credit card debts to keep rising this autumn, potentially driving more people to seek debt help.
- The FCA warned that unregulated firms collect personal details through cold calls and online adverts, sometimes impersonating debt charities or debt collectors.
- Warning signs flagged by the FCA include pressure tactics, repeated contact, being coached on how to respond to lenders, and being steered toward fee-charging solutions such as Individual Voluntary Arrangements (IVAs) without alternatives being properly explained.
- Moneyhelper, the government-backed website, offers free authorized debt advice, and consumers are urged to cross-check any firm's authorization against the FCA's register.
- The Financial Ombudsman Service is available to handle complaints from anyone unhappy with an authorized firm's service.
- Alison Walters, the FCA's director of consumer finance, said anyone struggling with debt deserves advice that "puts their interests first" and no one should be pressured or misled into paying for a solution that may not be right for them.
- StepChange chief executive Vikki Brownridge urged people to get "full, free and impartial debt advice first, exploring all options to clear your debt in the safest and most sustainable way."
Why it matters: As credit card defaults rise, financially stretched consumers become prime targets for predatory firms charging fees for advice that is freely available. The FCA's warning matters because people desperate enough to seek help risk being pushed toward expensive, unsuitable solutions like IVAs—or having their details sold to fee-charging firms posing as legitimate charities.
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