To mark World Mental Health Day, four leading banks have announced they are backing Money and Mental Health’s campaign to ‘Stop the DebtThreats.’
Barclays, Monzo, Nationwide and Metro Bank have joined over 30 charities in calling on the government to change out-of-date rules on debt letters, to make them less intimidating, and more supportive to people in problem debt. The firms are also pledging to take steps to improve their debt letters.
Research by Money and Mental Health shows that over 100,000 people in problem debt attempt suicide in England each year. While there are often many factors which contribute to someone becoming suicidal, the intimidating letters people in debt receive from lenders are a major factor which can leave people feeling there is no way out.
Money and Mental Health say that rules in the Consumer Credit Act 1974 that force financial firms to send debt letters feature intimidating use obscure language, and out-of-date advice to people in problem debt, often alongside threats of court action. This is aimed at ensuring that the person in debt is fully aware of their rights and sources of support. However, the intimidating and obscure content of these letters is instead often resulting in considerable distress for people in problem debt.
Money and Mental Health’s ‘Stop the #DebtThreats’ campaign – which is backed by a coalition of over 30 national charities and organisations – is calling on the government to change the rules on debt letters, to make them less intimidating, easier to understand and more supportive to people in problem debt.
In a joint statement representatives from Barclays Bank, Nationwide Building Society, Monzo Bank and Metro Bank have backed this call for the government to act.
The statement is co-signed by Tom Blomfield, CEO of Monzo Bank; Joe Garner, CEO of Nationwide Building Society; Craig Donaldson, CEO of Metro Bank; Sally Moran, Global Head of Barclays Financial Assistance at Barclays Bank:
“Over 100,000 people in problem debt attempt suicide each year in England alone. While there are many issues that can lead to someone feeling suicidal, research shows that the letters people in debt receive from lenders – which by law must include intimidating and obscure language, and often feature threats of court action – are a key factor that can leave people feeling panicked and helpless.”
“As creditors, we are taking steps to make our debt collections letters more supportive, but we are restricted by rules under the Consumer Credit Act 1974, which dictate the content of these letters. Fortunately, this legislation is currently under government review. ”
“This World Mental Health Day, we’re joining a coalition of more than 30 charities led by Money and Mental Health in calling on the government to change the rules on debt letters, so that we can make them more supportive and easier to understand. That will enable us to help more people deal with their debt, and will also save lives.”
Helen Undy, Chief Executive of the Money and Mental Health Policy Institute, said “Today Monzo, Nationwide, Barclays and Metro Bank are sending the government a clear message: they don’t want to send intimidating debt letters, and the rules that make them do so need to change.”
“It beggars belief that lenders have to send frightening letters to people in debt, despite the fact that many firms recognise the damage they can cause. The rules on these letters were meant to ensure people in debt know their rights and can get support, but the intimidating language firms are obliged to use often leaves people feeling there is no way out. ”
“We now have a cross-sector consensus among mental health charities, debt advice organisations and even creditors themselves that the rules on debt letters need to change. The government needs to act now, so that more people in problem debt can get the support they need, and more families can avoid the utter devastation that suicide brings.”