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FCA Thematic Review: Quality of debt management advice

June 25, 2015 No comments yet

The Financial Conduct Authority (FCA) today released their thematic review of the debt management sector.

You can view the full document by following the link below:

http://www.fca.org.uk/news/tr15-8-quality-of-debt-management-advice

The General Secretary of DEMSA, Richard Wharton gave this response:

“DEMSA welcomes the publication of the Quality of Debt Management Advice report by the FCA and considers that any action which will improve or help vulnerable consumers in dealing with their problems is welcomed.”

“DEMSA and its members take the implications and content of the report seriously and will continue to work with the regulator to ensure full authorisation of their businesses.”

“In the report the FCA considers that Debt Management firms that meet their standards (whether fee charging or free to customer) can provide a valuable service to consumers struggling with debt. DEMSA members are committed to meeting the Principles for Business as set out in the FCA Handbook and will continue to strive to meet these exacting standards and to provide vulnerable consumers with a fair and valuable service.”

DRF & DEMSA Joint Conference

March 26, 2015 Comments Off

DRF & DEMSA

Debt Resolution Forum & DEMSA Announces New Venue and Dates for Annual Conference

• DRF & DEMSA will jointly host 2015 Conference.
• New venue for Awards Dinner and Conference.
• Over 250 delegates expected.

DRF & DEMSA are delighted to announce that the 2015 Annual Conference will be held in Manchester again this year.

The Awards Dinner will be held at Hotel Football near Old Trafford on the evening of Wednesday 30 September. The annual dinner is a celebration of those individuals in the industry who deserve recognition. A drinks reception, three course bespoke meal and entertainment will be provided in the beautiful Stadium Suite with views over Manchester United’s ground.

DRF & DEMSA are thrilled that they will be holding their joint Annual Conference at Manchester United Football Club on Thursday 1st October 2015.

Richard Wharton said “DEMSA believes that this is the ideal opportunity for the industry to come together and look at the major issues facing it.”

David Mond said “Both venues are perfect for the DRF & DEMSA Annual Conference, and we will be able to offer sponsors and delegates an excellent opportunity to network, learn and discuss vital matters”.

If you require further information, please contact:

angela.scholefield@demsa.co.uk Direct Dial Tel: 0113 277 7610

Jo.Gordon@debtresolutionforum.org.uk Direct Dial Tel: 0161 969 2023

Click here for ticket sales

DRF & DEMSA Annual Conference 2015

March 26, 2015 Comments Off

DEMSA Chairman

March 24, 2014 Comments Off

Ray Watson, who was appointed as DEMSA Chairman last year has had to step aside from his role, although he will remain with DEMSA as a special adviser.

Richard Wharton, the General Secretary of DEMSA has assumed the role of Chairman, on an interim basis.

Ray Watson to be the new DEMSA chairman

September 19, 2013 Comments Off

Ray Watson is to join DEMSA (the Debt Managers Standards Association) as non-executive chairman. His appointment was confirmed by the DEMSA board on 17th September and he will formally take up the new role from the AGM on 9th October.

Ray is Regulatory & Compliance director at Walker Morris – an international law firm based in Leeds. Before that Ray spent many years in senior roles at the Office of Fair Trading where, as Head of UK Credit, he steered the organisation through the introduction of the Consumer Credit Act regime in 2006 as well as developing the regulatory system that the Act brought about.

Michael Land, outgoing chairman of DEMSA commented: “I announced at last year’s AGM that I would step down this year. As I do so I am immensely pleased to be able to pass the chairmanship of DEMSA onto Ray. He is a hugely respected figure in the industry and his commitment to high standards and best practice is well known. His decision to take on the role is both an endorsement of the progress DEMSA has made to improve quality in the sector, and a statement of intent for the organisation’s future.”

Ray Watson commented: “I decided to take on the chair of DEMSA because I recognise that it commits its members to provide the highest quality of service and support to their clients. I am excited to be joining DEMSA during what will clearly be a transformational period for members and the wider sector. The Debt Management Plan Protocol, which DEMSA has embraced, launches this autumn. More significantly, the transition of debt advice and solutions into the new Financial Conduct Authority regime next year will give a further reassurance to consumers in this sector.”

Richard Wharton, general secretary of DEMSA said: “Michael has made a huge contribution to DEMSA. He was instrumental in setting it up in 2000 and has, as chairman, driven the organisation forward since then. On behalf of the whole membership I’d like to thank Michael for his hard work and dedication.”

DEMSA welcomes the Money Advice Service’s commitment to quality standards in debt advice

July 19, 2013 Comments Off

The Debt Managers Standards Association (DEMSA) has endorsed the Money Advice Service’s commitment to raising standards in debt advice by setting out a quality framework. The framework, which was published by the Service last month, is designed to raise the bar for organisations operating within the debt advice sector. Three guiding principles sit at the heart of the framework – high quality organisations providing debt advice should be: focused on clients’ needs; well-governed; and committed to learning.

Explaining why DEMSA supports the framework, Melanie Taylor, Director of External Relations at DEMSA said:
“Anyone with debt problems has the right to expect that wherever they turn for advice they will receive high quality advice that is tailored to their needs and circumstances. That’s why we fully support the Money Advice Service’s framework which is designed to ensure that all debt advisers across the UK operate to the same standards framework.

“As our name suggests, we’re all about setting high standards for debt advice. At the organisational level our Code sets out clearly how firms should operate to ensure they provide a high quality service to their clients. At the individual level we launched our own debt advice qualification – ‘The Certificate of Money Advice Practice’ – two years ago, in conjunction with the University of Staffordshire and the Institute of Money Advisers. We will continue to work with the Money Advice Service to help develop the framework and, of course, will ensure that our own Code and qualification supports the Service’s new framework.”

Caroline Siarkiewicz, Head of the UK Debt Advice Programme at the Money Advice Service commented: “Our Quality Framework is an important step forward in our drive to bring the quality of debt advice in line across the whole country. We welcome DEMSA’s support and look forward to working collaboratively with the organisation, and many advice providers in the sector, to support the role it has to help ensure everyone receives high-quality advice.

Debt Help Direct Ltd and Money Worries Cease Trading

March 14, 2013 Comments Off

The above company are not, and never have been members of DEMSA. If any account holders of the above firms would like to consult any DEMSA member, they will be happy to assist. Please refer to our members’ page.

DEMSA was established in December 2000 in order to promote good practice in the debt management industry, and to protect the interests of the public and the lenders to whom they owe money.

NEW PROTECTIONS TO HELP CONSUMERS PAYING FOR DEBT MANAGEMENT ADVICE

February 7, 2013 Comments Off

Consumers who pay for advice on managing their debts will now be protected by a new Debt Management Plan (DMP) Protocol, launched by Consumer Affairs Minister Jo Swinson today.

Under the Protocol, agreed with providers and creditors, consumers will not be charged any fees before signing a contract with a Protocol compliant debt management company. Providers have agreed to spread the recovery of their set up fees, over at least the first six months, making plans more affordable and sustainable.

Companies that sign up to the Protocol will be expected to provide clients with information about other appropriate debt management options.

Consumer Affairs Minister Jo Swinson said:

“This is good news for consumers faced with debt problems. I am pleased to see commercial providers making these changes, which will see them help consumers by spreading the costs of the plan.

“However, consumers should be aware that there is also free advice available. For example, anyone with debt worries can contact the National Debtline on 0808 8084000 for free and confidential advice. The Money Advice Service can also signpost people to appropriate and free debt advice services. Under this Protocol anybody in debt who seeks paid-for advice will be made aware that free debt advice options are available before signing any contract with a fee charging provider.

“This Protocol comes in the wake of the refusal by the Office of Fair Trading (OFT) last week to renew the credit licences of two debt management companies and the refusal of the application of a new business.

“The Government is determined to drive up standards in this industry and ensure that people seeking paid-for advice are not disadvantaged by debt management companies that do not offer value for money.”

The Protocol will help drive up standards in the fee charging debt management sector in the run up to the launch of the  Financial Conduct Authority (FCA) which will take over responsibility for consumer credit from the OFT. The FCA will come into being on 1 April 2013 and will take over responsibility for consumer credit regulation from 1 April 2014.

The DMP Protocol, which is voluntary, will be independently monitored to ensure firms meet the standards and the spirit required of the protocol. Those companies that sign up will be able to advertise their compliance to consumers.

The Protocol will also be subject to a standing committee headed by The Insolvency Service which will oversee the protocol and report within the first 12 months of its operation.

The debt management industry and the public highlighted two key concerns in the charging structure, as part of the Government’s review into consumer credit and personal insolvency. Consumers said there was lack of awareness of where to go to get free debt advice while those willing to pay for the advice said they felt upfront fees by providers were driven more by profit for the providers than getting the best value for money.
Melanie Taylor from the Debt Managers Standards Association (DEMSA) said, “The Protocol is good news for consumers. Not only does it improve the operation of debt management plans and the auditing of providers, but it will also provide a clear way for consumers to differentiate between providers that are committed to the highest standards and those that are not.  DEMSA has long campaigned to raise standards across the sector and we’ve worked hard with The Insolvency Service and other stakeholders to deliver this Protocol.”

New report on fee charging debt management underlines the need for an industry protocol for debt management plans

November 8, 2012 Comments Off

DEMSA, the principal trade body in the professional debt management sector, today responded to a report on debt management, commissioned by Lloyds Banking Group and the Money Advice Trust. The report states that there are serious concerns over the practices of some fee charging debt management companies.

Commenting on the report, Michael Land, Chairman of DEMSA, said:

“As an organisation that has long worked to improve standards in the sector DEMSA is naturally concerned by the conclusions of this report. It is our firm belief that customers should receive a consistently high level of service in the quality of advice they receive, regardless of who provides this.

“The concerns which this report points to are the precise reasons why we need to implement an industry wide Debt Management Plan Protocol, as demanded by the Government. The Department of Business wishes to have agreed a common standard of best practice across the debt advice landscape by the end of November 2012. This would undoubtedly tackle many of the problems this report focuses on and give consumers the confidence they deserve.

“DEMSA has been working closely with the Government and other stakeholders for some time to develop a Protocol to ensure strong consumer safeguards across the debt management sector.”

Michael Land continued:

“Customers have long been accustomed to having an open choice of providers in the services they receive, what is important is that there is a robust framework in place to ensure common standards across all providers.”

DEMSA has been committed to high and rising standards since its inception in 2000, and its members operate under an OFT – approved Code of Conduct.

For further queries please contact:

Melanie Taylor, Director of External Relations at the Debt Managers Standards Association – 0113 277 7610
Chris Bose, Lansons Communications – 020 7294 3619

Grant Thornton produces Independent Study into Fee Charging Debt Management Market

November 6, 2012 Comments Off

A leading accountancy firm, Grant Thornton, recently undertook a major assessment of the professional debt management market. DEMSA, the principal trade body in the sector, commissioned the report to provide consumers with a clear and evidence-based picture of the sector. The report examines the structure of the market and the customer journey through a debt management plan.

Using primary and secondary research Grant Thornton uncovered a number of significant findings on the sector, including:

Consumer benefits

  • Throughout the lifecycle of an average debt management plan, professional debt management companies effectively help consumers reduce the initial balance of their debt by 30-35%. This benefit stems primarily from when a professional debt adviser freezes or lowers the interest rate on their clients’ debt
  • The report also identified how debt advisers offer a range of practical solutions to help their clients regain control of their finances. For example, professional debt advisers help their clients increase their disposable income through getting the best deal on utility rates

Market structure

  • At the end of 2011, DEMSA members had 220,000 Debt Management Plans (DMPs) under their management, accounting for a 34-42% overall share of the market
  • It takes DEMSA members on average 6 hours to set up a DMP at an average cost of £208
  • Just 17% of DEMSA members’ annual revenue is sourced from set-up fees, highlighting debt management companies’ interest in the long term sustainability of DMPs
  • Just under 1 in 4 consumers that sought advice from a DEMSA member entered into a DMP

Creditor experience

  • Creditors recognised that there is a place for both free to consumer and professional companies in debt advice
  • Creditors reported that DEMSA members are seen as amongst the best in the market and make real efforts to ensure compliance with industry standards and to drive best practice
  • Creditors recognised a number of benefits of using a debt management company including; ability to engage with customers, ability to act as an independent party to liaise and address the consumers’ debt issues with different creditors at one time

Commenting on the report, Michael Land, Chairman of DEMSA said: “This report provides an impartial and credible assessment of the professional debt advice market and the consumer journey through a debt management plan. One of the clear findings of the report is that the professional debt advice market makes a tangible improvement to a customer’s ability to deal with their debt. On average professional debt advisers are able to help consumers reduce the initial balance of their debt by 30-35%.

“A consumer who goes to a member of DEMSA can expect a range of practical solutions to help them regain control of their finances. Members of DEMSA invest heavily to ensure that the quality of advice their clients receive is consistently high. It is for that reason that DEMSA launched a professional qualification in partnership with the Institute of Money Advisers. I am pleased that the consumer benefits of this expert advice have been recognised in this report.

“Thus far there has been little independent and credible assessment of the professional debt management market. This lack of evidence has given rise to some misunderstanding, I hope this report will help to produce a more balanced view.”

Please click here to view the full report.

For further queries please contact:
Melanie Taylor, Director of External Relations at the Debt Managers Standards Association – 0113 277 7610
Chris Bose, Lansons Communications – 020 7294 3619