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Insolvency-Tech Platform Cerebreon Signs up to the Vulnerability Registration Service

Cerebreon, a leading data insights platform in the insolvency tech market, has joined the Vulnerability Registration Service as a member to enhance their existing vulnerability algorithms and rapidly identify individuals that need additional support in the debt process.

With unsecured debt reaching record highs and Covid-19 causing increasing levels of financial distress, Cerebreon’s partnership with the Vulnerability Registration Service is the next stage in developing the 360o view of the consumer.

This perspective helps Cerebreon identify those consumers likely to miss their repayments so that preventative action can be taken. The best outcome can be achieved for vulnerable consumers whilst protecting debt industry clients’ incomes in a time when predictability is key for sustaining business.

Gillian Doyle, CEO of Cerebreon, said: “Checking for vulnerability should be as normal to the financial services industry just as anti-money-laundering and credit checks are. This is much more than a regulatory issue – by signing up to the Vulnerability Registration Service, we are helping our own customers to rapidly identify additional vulnerabilities outside of financial distress so that the right resource, skill set or solution can be matched to the specific needs of the consumer.”

She went on to say, “Our clients are exceptional at giving advice, but the time needed to fully understand the consumer’s situation is substantial and costly. Adding the Vulnerability Registration Service to our platform reduces this time so that they can more effectively spend the time on resolution to achieve the best outcome for all stakeholders.”

A not-for-profit organisation, the Vulnerability Registration Service provides the UK’s first central vulnerability database. As a member, Cerebreon will be able to check against the database and be alerted if there is a vulnerability flag registered against a customer record.

These flags provide an extra layer of protection to ensure that Cerebreon clients, including debt advice agencies and creditors, can instantly understand if a vulnerability exists for a consumer. With increasing volumes of calls and help required for over-indebted consumers, these insights are extremely important to minimise compliance risks for the firms and bring an individual bespoke quality to a volume situation.

Helen Lord, Director of The Vulnerability Registration Service concluded: “Financial services firms often want to do the right thing when it comes to protecting their most vulnerable customers but don’t always have the means to identify them. Through the use of the Vulnerability Registration Service, this challenge is easily overcome, and it is great to have Cerebreon on-board and take such a strong stance in helping the insolvency and debt industry meet their vulnerability obligations.”

Vulnerable people, including those in financial distress, with mental health problems, at risk of financial abuse, victims of fraud, their representatives such as those with power of attorney can register for free with the Vulnerability Registration Service to make financial services providers and other organisations aware of their current financial or personal vulnerable circumstances.

The Vulnerability Registration Service is urging more financial services organisations, utilities and collection agencies to join its membership and further details can be found at www.vulnerabilityregistrationservice.co.uk

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Financial Conduct Authority Portfolio letter for debt purchase, debt collection and debt administrator firms.

Are you doing enough to identify and protect vulnerable customers?

The Financial Conduct Authority (FCA) published its Portfolio letter for debt purchase, debt collection and debt administrator firms on the 18th January identifying drivers of harm and how firms should mitigate risks. It highlights the major concern that firms can fail to recognise and address the needs and challenges faced by vulnerable consumers. The Vulnerability Registration Service (VRS) is a tool that can help organisations identify vulnerable customers allowing them to determine how they can obtain the same fair outcomes as other consumers.

The FCA aims to publish its final Guidance on the fair treatment of vulnerable customers early this year and, subsequently, firms’ compliance in this area will be monitored. Are you prepared?

How can the Vulnerability Registration Service help?

We help debt purchase, debt collection, debt administrators and other financial services organisations to identify and help ensure the fair treatment of vulnerable customers. This helps to reduce the risk of regulatory fines, bad debt and reputational damage and also helps to protect the vulnerable customer from harm and further bad debt.

VRS is a simple data sharing model that enables firms to identify vulnerable customers and therefore allows them to be treated appropriately. We draw our information from self-registrations and people who have the authority to register someone else (e.g. Power of Attorney). We work with local authorities, solicitors and estate management companies source Court of Protection Orders where a lack of mental capacity means that an individual is not in a position to manage their own financial affairs.

The VRS is reciprocal and allows firms to provide us with information about their own vulnerable customers, where there is a legal basis to do so. This means that customers can also be treated fairly by other companies where they have a relationship, and companies can benefit from the information provided by third parties.

VRS gives the opportunity to share more detail about vulnerability through a flag system. The detail is provided consensually and shows where people are affected by severe financial difficulty, physical disability, mental capacity, lifestyle events such as bereavement or divorce. We also show where people have accessibility issues e.g. internet. We have introduced a flag so that people can highlight when they have been directly impacted by the pandemic.

Checking whether customers are in a vulnerable situation through VRS is simple and low-cost. It is relevant at key points in collections – at the point of default, prior to legal action and enforcement and when debt is passed to a debt collection agency and beyond.

Access to VRS is not technically onerous and does not incur significant development costs.

We deploy API technology and security and compliance are integral to the functionality of our service. We are also able to work with companies to batch run customer bases against the VRS to show any matches. Checking whether the people you are dealing with are registered as vulnerable on our database is an easy process. It is a tool to help identify vulnerable people that is readily available and enables you to take a proactive step to handling vulnerability responsibly.

For details of how you could work with the Vulnerability Registration Service to identify your vulnerable customers, help meet your obligations, and ensure fair treatment, please contact Helen Lord helen@vregservice.co.uk

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How to identify exactly who is vulnerable

We all know that need to treat vulnerable people in an appropriate way, we know that we have a corporate responsibility to do so. We also know that the regulators expect us to take the right approach. The challenge is often how to identify exactly who is vulnerable. The Vulnerability Registration Service holds a database of people who are vulnerable and there are no barriers in the way to stop organisations checking against it.

The pandemic has plunged many more people into vulnerable situations completely unexpectedly. It has also exacerbated the difficult circumstances people were already in. It has put another complexion on the nature of vulnerability – that may be increasing reliance on digital communication, furlough, redundancy, reduced pay, reliance on others and the need to isolate.

Vulnerability touches all aspects of our lives whether that be rental or mortgage, health, insurance, banking, utilities or our mobile phones. All of these are now essential to our everyday lives and difficult personal situations can impact upon all of them. One area guaranteed to compound these difficulties is the knowledge that we are in debt and that we are being targeted to repay that debt so it is crucial that the handling of this is managed as sensitively and case-appropriately as possible.

One of the main problems that people cite, when they are facing difficulties, is the need to repeat their circumstances, highlighting the fact that they are in a vulnerable situation again and again. VRS is designed to alert companies to vulnerability, minimising that the need for people to repeat themselves and possibly having to navigate their way through call centres or websites in order to speak to the right people.

Registering information with VRS is completely free and so it gives the opportunity to help protect your customers when they are dealing with other companies. If a customer is in a vulnerable position, where the right authority is given, companies can work with them to get them added to the VRS database and therefore alert other organisations to their situation.

VRS gives people the opportunity to provide more detail about their vulnerability through a flag system. The detail is provided consensually and shows where people are affected by severe financial difficulty, physical disability, mental capacity, lifestyle events such as bereavement or divorce. We also show where people have accessibility issues eg internet. We have introduced a flag so that people can highlight when they have been directly impacted by the pandemic.

People can self-register on the VRS and companies can work with them to register or, where a Power of Attorney is in place, somebody can register on their behalf. We hold Court of Protection Orders sourced from local authorities – these orders are recorded where there is a mental capacity issue and their finances are not being managed directly by themselves. The information is wholly relevant to companies who may have a relationship with these individuals.

Checking whether customers are in a vulnerable situation through VRS is simple and low-cost. It is relevant at key points in collections – at the point of default, prior to legal action and enforcement and when debt is passed to a debt collection agency and beyond.

Access to VRS is not technically onerous and does not incur significant development costs. We deploy API technology and security and compliance are integral to the functionality of our service. We are also able to work with companies to batch run customer bases against the VRS to show any matches. Checking whether the people you are dealing with are registered as vulnerable on our database is an easy process, a tool to help identify vulnerable people is readily available and it is a proactive step to handling vulnerability responsibly.

For details of how to work with the Vulnerability Registration Service and to make sure that you are taking advantage of a means to identify your vulnerable customers, please contact Helen Lord helen@vregservice.co.uk.

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5 Tips to help save for Christmas

It’s about this time of year when the shops start showing the first signs of Christmas on the way – and for many of us, that can mean a familiar sinking feeling as we wonder where we’re going to get the money from to cover all the presents, parties and other costs that the festive season brings. If you face Christmas with a sense of dread rather than excitement, then hopefully these tips will help.

1) Set a budget

It’s a good idea to know how much you can afford, before you start spending. That way you can avoid any nasty surprises when you check your bank balance!

And if the amount isn’t as much as you’d like – it’s better to know this in advance so you can tweak your plans to fit your budget and avoid creating unwanted debt.

2) Start early

Rather than leaving your Christmas savings to the last minute, start putting a little aside each month so that by the time the festive season comes around you already have some money to dip into.

If you’re really organised, you might even buy your gifts throughout the year, which brings the added bonus of being able to avoid all the queues of last-minute shoppers in December!

3) Consider alternatives to paid gifts

Sometimes, the most thoughtful gifts aren’t the expensive ones you buy in shops. Get creative and think about what you can give people that won’t cost you a penny (or at least may cost you less).

Perhaps a night of babysitting or cleaning someone’s home for them?

Do you have any specific talents or skills that you could turn into wonderful presents for people? Maybe you could create a piece of art or some delicious homemade biscuits or jam.

4) Shop around for the best deals

Whether it’s Christmas presents, food, drink or other festive items, prices can differ hugely so make sure you do your research to get the best deals available. Keep an eye out for special offers – lots of shops have them in the lead up to Christmas.

5) Make use of charity shops

Try browsing your local charity shops. They can be a wonderful place to find beautiful and unusual presents, Christmas party clothes and even decorations and tableware.

As well as saving money, you’ll be supporting a good cause – and isn’t that what Christmas is all about?

Lastly, if you’d like more ideas on how to get ready for Christmas this year then do come and join our Facebook group, Master Your Money and Your Mental Health. It’s a great place to swap tips and get some money saving inspiration.

Have you registered with the VRS?

Christmas can be a particularly difficult time for anyone in a financially vulnerable situation. If that’s you, then don’t forget you can register with the Vulnerability Registration Service (VRS). Our service is there to protect and support people during times in their lives when they’re financially vulnerable. By registering, you can let companies who use the VRS know about your circumstances so that they can treat you and your information accordingly.

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5 Tips to improve your credit score

If you saw our recent post about credit score myths, you’ll know that you don’t actually have just one universal credit score. In fact, lenders will have their own different scoring criteria for each of their products.

Of course, there are things you can do to ensure that when you do apply for credit, your score will be as high as possible.

1) Find out what your score is

Firstly, it helps to know what your score actually is! Each of the Credit Reference Agencies (CRA’s) have a service which allows you to see an example score based on the information in your credit report. It’s a great idea to check these scores as well as your reports. This way, you can check the information that’s being recorded about you and make sure it’s all correct.

For further information, you can visit the websites for each of the UK’s CRA’s here:

2) Register on the Electoral Roll

Not many people know this, but the electoral roll is used to help calculate your score. If you’re not registered, it’s likely to have a negative impact and lower your score.

This might seem strange, but companies use the electoral roll to help them to verify your identity. When you don’t appear it’s harder for them to do this and so they’re more likely to decline your application.

If you’re not registered, don’t worry – it’s really simple to get yourself added. You can learn more here.

3) Close accounts you’re not using

The amount of credit that you have available to you can also impact your credit score. That means things like credit card limits or overdrafts – even if you haven’t used them!

If you have an account such as a catalogue or credit card with a limit that’s bigger than your needs or that you’re just not using at all, then it’s a good idea to contact the company to reduce your limit or close your account.

4) Make payments on time

When you think of your credit score as a reflection of how you’re managing your existing credit accounts, it’s not surprising to hear that when you make late payments, it’s likely to have a negative impact on your score.

Late payments are recorded on your credit report – and before long, too many late payments can turn into a default, a county court judgment and even bankruptcy.

Get into good habits now to maintain a healthy credit history. Where possible, set up direct debits so that payments are always made on time.

5) Don’t make too many applications for credit at once

When you apply for credit, a search is recorded on your credit report – but lenders can’t see if that search resulted in you getting credit or not. If you’ve made lots of applications over a short period of time, lenders will see this as a potential risk because you might already be over-committed. It can also be a sign that you’re struggling to live within your means.

Are you financially vulnerable right now?

Our service is there to protect and support people during times in their lives when they’re financially vulnerable. By registering, you can let companies who use the VRS know about your circumstances so that they can treat you and your information accordingly.

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5 Credit Score Myths

If you’ve ever applied for credit, whether it’s a mortgage, credit card, loan or even a store card, then there’s a very good chance that the company you were applying to, did a credit search on you. This simply means that they’re checking your credit history to see if you’re going to be a reliable customer who is likely to make repayments on time.

In this post, we’re busting a few of the myths and misinformation out there about credit scores, so you can see exactly how yours works – and how you can improve it.

Myth #1: The “blacklist”
Good news! There is no list of people who have been ‘blacklisted’ for credit.

When you apply for credit, the lender will take into account all sorts of information to help them decide whether to accept or decline your application. The ultimate decision will lie with the lender and will be based on a number of factors, such as their own lending criteria, your personal details, such as your income and your credit history. While you may be declined for one product, it doesn’t necessarily mean you’ll be declined for another.

Myth #2: You can pay to get information removed
Unfortunately, there are unscrupulous people and companies out there who will tell you that they can have information such as defaults or county court judgments removed from your credit report – for a fee of course.

Tempting as that may sound, the truth is that information can’t be removed from your credit report unless it’s found to be incorrect.

Most information will remain on your report for 6 years.

Myth #3: You have one, universal credit score
People often refer to their ‘credit score’ like it’s one score that all lenders will see when they do a credit search.

In fact, each lender has their own scoring system which is set up to score against their specific lending criteria.

It’s possible to check your score with each of the Credit Reference Agencies (CRA’s) – and they will give you an idea of what type of score you might expect when you apply for credit, but it’s important to remember that this number can and will vary from lender to lender.

Myth #4: Credit Reference Agencies decide whether you get credit
When you apply to a lender and they do a credit check – it might look like the Credit Reference Agency are the ones deciding whether it’s a ‘yes’ or ‘no’.

In fact, they’re just sharing factual information about your credit history. The lenders themselves use this information to give you a score and that score is what decides whether they accept or decline your application.

Myth #5: If you have lots of debt, you’ll have a poor credit score

The amount of debt you have can have an impact on your score. Especially, if along with all the other information you’ve provided it appears that you might already be overcommitted and so might struggle to make your repayments.

However, if you have a manageable amount of debt that you are repaying on time and in accordance with your contract, this will generally have a positive impact on your score.

Are you financially vulnerable right now?

Our service is there to protect and support people during times in their lives when they’re financially vulnerable. By registering, you can let companies who use the VRS know about your circumstances so that they can treat you and your information accordingly.

Register here

For further information, you can visit the websites for each of the UK’s CRA’s here:

Experian
Equifax
TransUnion

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Vulnerability: what is it and why should we record it?

The FCA describes a vulnerable consumer as somebody who, due to their personal circumstances, is especially susceptible to harm, particularly when a firm is not acting with appropriate levels of care. There are many reasons a person may be vulnerable. These may be related to health, capability, resilience, or the impact of a life event. The FCA expects firms to be doing the right thing for vulnerable consumers and embed this into their culture.

Service needs

Vulnerable customers are more likely to have a particular service need, for example they may require extra time to understand information helping them make decisions. The FCA is encouraging firms to consider the impact of their service on vulnerable customers.

The FCA expects customer services and systems to be in place that enable staff to respond flexibly to the needs of vulnerable customers and this can be especially challenging where processes are fully automated and communications are required to provide the necessary support.

Firm’s processes and systems should also help staff record and share information about vulnerable customers’ needs, so that customers do not have to repeat information and staff have the information to hand so they are well equipped to respond.

Firms should be aware of specialist support for vulnerable customers, either internally such as specialist teams, or externally such as charities or third-party access arrangements. They should ensure these are accessible and made known to all consumers, especially those that are identified as being vulnerable.

Interestingly, the latest FCA guidance for firms on the fair treatment of vulnerable customers introduces costs into the latest FCA guidance for the first time. The FCA estimate that implementing their guidance across financial services will cost £710m as a ‘one-off’ figure, and £450m in each following year. For the smallest firm, this could cost £3,200 and £2,400, and for the largest £3.3m and £2.4m.

This is where the Vulnerability Registration Service (VRS) can help. The VRS is a not-for-profit, low-cost service. The VRS is a register of identified vulnerable consumers.

Single reference point

The VRS provides consumers and firms that use the service with a single reference point to ensure that people who are looking to protect themselves against further debt or related financial problems do not need to have the same, often emotional, conversation with those many organisations with whom they have a touch point with.

The organisations that use our service will be alerted to someone’s situation needs, which should be considered whether they are contacting them for the first time or where they have an existing relationship with them.
The VRS has recently added a number of sub-flags, drivers of vulnerability, that help to identify a consumers vulnerability, clearly and quickly to staff, thus alerting them to a customer who may require help and ensuring the appropriate team can make the right approach.

In summary, The VRS can help your firm to identify vulnerable consumers and provide enough information, so that your staff can make the right approach. The VRS flag system will visually alert your staff members, informing them that a customer has a vulnerability. The VRS sub flags will provide enough information for the customer to be placed with the right team.

The VRS would be delighted to discuss any opportunities to provide its’ service to your organisation, so please do get in touch.

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How to support someone who can no longer manage their own finances

There are a number of reasons why someone may find themselves unable to manage their own money. They may have a condition such as autism or downs syndrome which makes it very difficult or they may have an illness like dementia or Alzheimer’s. In these situations, it’s important that people have someone they trust who can take care of their financial affairs for them. If you have found yourself in the position where you need to support someone who can no longer manage their own finances, then here are some simple steps you can take.

Establish the level of support that is needed

A good place to start is to get clear on what support – and how much of it, the person needs from you. It could be that they just need some help setting up payments for their bills or creating a budget for their household expenses. Or they may need more formal and comprehensive support in handling all of their financial affairs.

Informal support

There are lots of different ways you can help someone who is struggling to manage their money. Here are a few for you to consider and discuss with the person you’re looking to support:

  • Setting up standing orders and direct debits for bill payments to make sure these are paid on time
  • Creating an income and expenditure with them to help them to keep to a budget
  • Support them with any big financial decisions such as any large purchases or investments
  • Help with paperwork
  • Attend meetings with them – for example with financial advisers, benefits advisers or bank officials. These can be stressful at the best of times so some moral support can make all the difference

Formal Support

More formal support such as getting a Power of Attorney will be appropriate either where you and the other person have both agreed this is for the best or where the other person has been deemed not to have the mental capacity to manage their own affairs (for example, where they have dementia).

What is Power of Attorney?

This is a legal document which lets someone choose one or more people to make decisions on their behalf. Where the situation is temporary, they can apply for Ordinary Power of Attorney and where it’s permanent, they would apply for Lasting Power of Attorney. There are two types:

Health and welfare
Property and financial affairs.

It’s possible to apply for just one or both.

To apply for power of attorney, the ‘donor’ (the person requiring support) must be over 18 and have mental capacity – which means they must still be able to make their own decisions at the time they apply.

For more information on applying for a Power of Attorney, visit gov.uk.

Registering with the VRS

Anyone who is struggling to manage their own finances would be considered financially vulnerable and so it’s a good idea to let companies know their situation. If you’re offering informal support, then have a chat about the benefits of registering.

Alternatively, if you’re managing someone’s finances on a more formal basis and have an appropriate signed authority or legal Power of Attorney, then you can register on their behalf.

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6 Things to do if you lose your job

Losing your job can be an extremely stressful time, especially if it happens unexpectedly. It can often leave individuals and families with a significant drop in income and a sudden inability to pay their bills. The good news is, there are steps that you can take to help you to get back on track again as quickly as possible, so if you or your partner have recently become unemployed, take a look at the tips below.

1) Check what support you can get

The sooner you can find a way to supplement your lost income while you search for new employment, the better! The government have provided this handy tool to help you identify what support or benefits you may qualify for. Then make sure you make a claim for anything that’s relevant. It can feel difficult or awkward – but remember that these systems are in place to support people just like you who have found themselves in a vulnerable situation, often through no fault of their own.

2) Speak to your landlord or mortgage provider

When you have a sudden and significant change to your financial situation, it’s a good idea to protect your home. Get in contact with your landlord or mortgage lender as soon as you can to let them know what’s going on. They may be able to offer you some support, such as payment breaks or reduced payments for a period of time until you’re back on your feet again.

3) Review your budget

While it may feel tempting to bury your head in the sand, it’s important to review your new financial situation immediately so you know exactly what your income and expenses are. This will also give you an opportunity to cut any unnecessary or forgotten payments that you’re making such as un-used gym memberships or subscriptions.

Further reading: How to budget on a small income

4) Don’t ignore your debts

If you can, continue to make any monthly payments to your debts such as loans or credit cards. Failure to do this could result in additional charges or even defaults or county court judgments which would have a detrimental impact on your credit history.
If you’re struggling to maintain payments, then get some support and speak to a debt advisor. They’ll be able to advise on your best course of action and may also speak to lenders on your behalf to arrange reduced monthly payments.

5) Use the time to improve your job opportunities

When you lose your job, it can feel strange to suddenly find yourself with a lot more free time than normal. It’s easy to let yourself become depressed and inactive, but instead – use this time to improve your job opportunities by updating your CV, speaking to a career advisor or even learning a new skill.

6) Register with the VRS

Our service is there to protect and support people during times in their lives when they’re financially vulnerable. By registering, you can let companies who use the VRS know about the change in your circumstances so that they can treat you and your information accordingly.

Register here

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Who should register for the VRS?

The Vulnerability Registration Service (VRS) provides vulnerable consumers with a way of sharing information on their circumstances with companies they have dealings with.

People can choose to be pre-declined for credit applications – or, if they prefer, they can simply make companies aware of their circumstances, so that these can be taken into consideration during any dealings with them. This may include applications or in the case of existing accounts, managing arrears or debt collections.

So, what is vulnerability – and how do you know if you should register? In this post, we want to share some of the main causes of vulnerability to help you decide if registering with the VRS is right for you.

Illness
Any serious health issue such as cancer or a heart attack can have a huge impact on your life – and your ability to work and maintain a stable financial situation. Many people find themselves financially vulnerable in these circumstances and by registering with the VRS, they can let companies know what’s going on.

Physical Disability
People with physical disabilities can find their earning potential is limited. On top of this, there are often higher costs to consider such as specialised equipment and care.
The VRS can be a good option for anyone with a physical disability.

Mental Health
There are numerous links between mental health issues and debt. Mental health conditions such as bi-polar can often lead to irrational behaviour and over-spending. If you’re worried that your mental health could cause you to get into un-manageable debt (or if it already has), then the VRS can help you to protect yourself from this.

Cognitive Disorder
Conditions such as dementia, autism or down syndrome make it incredibly difficult (or in some cases, impossible) for sufferers to manage their finances without support. In these instances, the individual (or someone who has legal responsibility for them) can register with the VRS to ensure that companies are aware of their circumstances and treat them accordingly.

Life Event
Vulnerability can often be caused by our life circumstances at a given time. Life events such as the death of a loved one, divorce or addiction can suddenly throw our finances into turmoil. Rather than struggling through, registering with the VRS can give you some peace of mind and let companies know what’s going on until you’re in a better place.

Financial Circumstances
An individual’s financial circumstances are a very common cause of vulnerability. If you are living on a very low income, you’re relying on benefits and/or you have high levels of debt, then that puts you in a vulnerable situation and by registering with the VRS, you can help to protect yourself from further debt and let companies know that you’re struggling right now.

Financial Capability

Lastly, financial management can be extremely difficult for some people, for example the very young, the elderly, someone who has poor literacy and numeracy and people for whom English isn’t their first language. In these examples, the VRS can provide some protection against unmanageable debt and offer a way for you to let companies know your situation.

If you think the VRS could be a good option for you, then registering costs nothing and couldn’t be simpler. You can watch this quick tutorial to see exactly what to do. Or check out our FAQ’s if you want to learn more.

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