Credit, Collections & Insolvency News
There are times when it feels like fate is finally stepping in to lend a hand, and the release of the Ministry of Justice consultation on the benefits of adding claimant data to the public Register, swiftly followed by the FCA’s publication of their Credit Information Market Improvements definitely feels like one of those times.
Followers, stakeholders and customers of Registry Trust will be aware that we have been campaigning for improvements in the publication and usage of public data for some time. A key component of our suggested improvements has been the addition of claimant data on the Register. The Ministry of Justice have now launched a public consultation to gather views and opinions on the idea. Key stakeholders have long been aware of the benefits to their sector of publishing claimant data, but what is not always apparent is the sheer number of sectors and interest groups that would reap the benefits of this change.
Given I refer to the FCA, and their Credit Information Market work, perhaps I should start with the regulatory community? If Registry Trust were provided with the missing data, we would be able to easily provide all regulators, not just those in the financial sector, with an indicator of the quality controls they have in place. All members of the UK Regulatory Network would be able to use this information to not only help to assess the firms they regulate, but also to challenge common assumptions. If an example was needed, we could take a look at recent coverage of the Buy Now Pay Later sector. There is debate, (and fair to say, some strongly held beliefs) about the impact of the BNPL sector. When you read through the commentary though, it is clear that people (at best) have guess-timates on the impact of the BNPL sector. They cannot say if it is an entire sector, or specific firms, or indeed, if a rise in judgments has absolutely nothing to do with the BNPL sector at all. Lest anyone need a reminder – we are living in the 21st century, with a plethora of data and the systems to help us analyse and understand it. Guess-timates are not good enough.
This leads me onto the benefits for policy makers and economists. We know from our interactions and partnerships with the Consumer Data Research Council and the University of Liverpool, how much reliable data is needed in order to help academics and other analysts obtain better insights into the source of problem debt within the economy, enriching research and the resulting policymaking.
For debt advisors, who are struggling with the ongoing call to do more with less, claimant data could significantly improve their operational efficiencies, allowing them to spend far more time with those who need their help and support. Debt advice groups have less finance; less resource; and less time. So why, in this day and age, do we insist on this archaic system that sees the under pressure debt adviser spend hours (sometimes literally hours) of their time on the phone to the court service, when there is a readily available alternative? It makes no sense.
The court service themselves. A justice system that is independent and efficient is the hallmark of any decent society. Providing justice in a fair, impartial and timely manner. Our court service are still navigating significant backlogs of work, but Registry Trust can, and will help with this. At one stroke of the (legislative) pen, we can remove a significant number of queries every single week, all without costing them a penny. Our own analysis indicates we could save them in the region of 200 queries a week. Anecdotal evidence from the courts indicate that c.35% of their written enquiries relate to obtaining the name of the claimant relating to a CCJ. By adding claimant data to the Register of Judgments, Orders and Fines, the speed and efficiency of the courts service would be greatly improved and would allow for scarce resources to be better utilised elsewhere.
Those who are work in either the credit or due diligence industries will recognise the truth of the statement that from a lending perspective, not all debts are equal. A lender will absolutely be more interested in a more recent judgment, than one from 5 years ago. And if they were able to access that information, they would absolutely be more interested in lending to someone who had a debt for a parking fine, than they would a credit card debt. And these details matter. They matter because the existence of a CCJ doesn’t just mean you might not get your overdraft extended – as annoying as that might be. It also means you can lose out on insurance; a new home; a new job. Details matter; nuance matters; data matters. Adding claimant data would enable lenders and underwriters to make more detailed accurate assessments when lending, instead of the black and white, binary decision making they are more or less forced into now.
And last, but very much not least, let’s think of the consumers and small businesses who are the subject of a judgment. Irrespective of the circumstances behind the judgment, finding out about it will typically come at a high stress time in your life. At the risk of attempting to tug on the heartstrings a bit too much, let me paint you a picture. You’ve scrimped and saved for years, denying yourselves the Instagram-approved exotic holidays; the avocado on toast brunches, and you’re finally ready to purchase a place of your own. But guess what – you can’t. Because there is a judgment against you. You don’t know about it, since you have moved multiple times since then. But it causes havoc in your life. If you are lucky, very lucky, you are able to pay it, and get it satisfied quickly. But of course, you do need to know who you are paying. The likelihood is that your would-be mortgage lender gives you the news first. So you ask them who it is from? They don’t know. So you try the credit reference agency. They cannot tell you – but they do tell you they get all of their information from Registry Trust. So you try that – you get hold of Registry Trust – they cannot tell you either. They’re great, but unable to help. You have to phone the court. Ah. Good luck with that. If you are lucky, that will be a mere 45 minutes of your life on hold. During which, you’re trying to both hold down a job, and fend off queries from your mortgage broker. Can you imagine the stress?! I’ve been deliberately emotive here, but you only need to read through some of the online Google reviews for Registry Trust to realise just how close to home this scenario is for many people.
There are still many other groups who would benefit from this change – journalists, and consumer representatives, including politicians. Judgment data is a valuable data set for financial and consumer interest journalists which would improve timeliness of stories about county court judgments. For politicians, with an important role to play in understanding the drivers of debt for their constituents, wouldn’t it be useful to know that the sudden increase in parking fine judgments came just after the building of that new hospital? Or that the judgments for non-payment of utility debt is out of step with the national average, prompting investigations into just why that is? Providing claimant data would enable elected representatives, such as members of Parliament and local authorities, to represent and serve their constituents with ensuring transparent public services and delivering value for taxpayers’ money.
Registry Trust is fully equipped to assist with the objective of publishing claimant data as we already maintain the Register for England and Wales. The process to transfer the information already exists. We are confident that amending the system to provide the claimant name in addition to the remaining data would be a minimal cost to the courts and will effectively save money in the long-term. All that is required is a tweak in the law.
How can you support?
First and foremost, make sure you respond to the consultation. It’s public, and available by clicking here. You can also stay up to date with our campaign by signing up to our newsletter by clicking here, or by following our social media channels, or get in touch with the Registry Trust by e-mailing us at press@registry-trust.org.uk
