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Can automated processing work with non-standard consumers

There is no doubt automated services are increasingly being offered online across all business sectors and are becoming more remote.

This can make it extremely difficult for firms to identify a non-standard consumer’s situation or circumstance. In many cases automation processes, will not identify a consumer’s vulnerability and real life events will not be factored in. The failure of internal automated systems to spot vulnerable consumers can lead to an unwanted situation where a consumer may suffer detriment.Pro-active solutions that can help prevent vulnerable situations from the outset are what is needed and needed now. Our policy-makers both in the UK and internationally have already realised that a flexible approach is necessary to meet the needs of a diverse customer base.
One in four people has a mental disorder at some point in their life
Vulnerability includes many different conditions that can affect any one of us at any time of our lives. It makes our coping skills and resilience feel frail and exposed to detriment if the situation is not handled appropriately by the firms and organisations that provide us all manner of financial services. There is no doubt vulnerability is a key issue within the Boardroom of most firms worth their salt. Our own government says one in four people will experience a mental health problem at some point in their life, with an annual cost of £105bn. Our Prime Minister recently said mental health had been “dangerously disregarded” as secondary to physical health and changing that would go “right to the heart of our humanity”. It is right that all financial service and financial firms should focus in this important area.

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How to handle Vulnerability issues sensitively and professionally

“VRS”, enabling an individual’s vulnerability issues to be handled sensitively and professionally.

The Vulnerability Registration Service (‘VRS’) has been developed to help vulnerable consumers protect themselves against the financial, social and very personal hardship suffered as a result of debt and financial problems.

The VRS is independent of any other database provider or credit reference agency. Its sole purpose is to protect consumers and provide organisations with a tool to complement their regulatory and social responsibilities around dealing with vulnerable people at a particular point in their lives. It does not replace an organisation’s responsibilities for identifying and counselling vulnerable consumers, but provides a ‘decision agnostic’ platform for consumers and the organisations they deal with as an additional safeguard for consumers during their period of vulnerability.

The VRS recognises the many forms of consumer vulnerability, including that of mental health or incapacity (half of those in debt crisis have a mental health problem*) and provides a single reference point for consumers and organisations participating in the VRS, enabling an individual’s vulnerability issues to be handled sensitively and professionally.

Whilst most organisations are handling vulnerable cases as best they can, it invariably tends to always be after the event and this is where detriment can come in. Many common vulnerable scenarios are clear and obvious, for example; the death of a loved one, divorce, being made jobless or homeless or in suffering a life-threatening disease, these are vulnerable situations that we can all recognise. In many cases where people experience vulnerable situations they will also suffer a financial shock, this is separate to the emotional outcome. It is well recognised that mental health problems can cause severe debt, and severe debt can cause mental health problems.

There are many less well known vulnerable scenarios that many people will not have heard of and whilst not wishing to begin to describe or prioritise each one, one that particularly rankles is financial abuse whereby one partner financially abuses the other by using their partner’s identity and having access to banking details fraudulently obtains credit or goods and leaves the debt to the abused partner. Partner intimidation and financial abuse is without doubt an awful situation to find oneself in, magnified if children are present.

Pro-active solutions that can help prevent vulnerable situations from the outset are what is needed and needed now. It is encouraging to see that from the Government, including the Prime Minister, the Financial Conduct Authority, mental health organisations, practitioners and the many charitable organisations and groups that the vulnerability issue is being raised and given more prominence. All businesses across all sectors need to start stepping up to the Vulnerability challenge.

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The Vulnerability Registration Service opens its doors

The Vulnerability Registration Service (‘VRS’), the UK’s first central register for helping vulnerable consumers protect themselves against further debt or financial stress, opens its doors on 1 March through its dedicated consumer portal.

All organisations have a social, moral and regulatory responsibility to identify vulnerable consumers. And many have invested considerably in this area to help people at a particularly difficult and stressful point in their lives.

But having identified and counselled a vulnerable consumer, until now there has been no way to make sure their circumstances are known to other organisations and that consumer will have to go through a similarly distressing experience repeating their very personal story.

The Vulnerability Registration Service starts to address this challenge by providing a platform for organisations using the service with a single point of reference as a tool to complement their own vulnerability responsibilities and further protect the consumers they serve.

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Financial Abuse

It often starts innocently enough, your partner asks to see a receipt for your recent clothes shop, or apologise that he or she opened your bank or credit card statement by mistake. It is not always easy for the abused to recognise when financial abuse is taking place, in the early stages of a relationship it may appear to be part of the usual financial arrangements that couples agree between themselves, many new couples will open joint bank accounts. It is often easier to see the beginning of financial abuse with hindsight. But this can be the start of such habits that can then over time build into more controlling behaviours, which can leave you worried and fearful every time you open your wallet.

Financial abuse can involve your partner spending your jointly-earned money, start making you pay all the home running costs, and scrutinise every penny you spend. It can get worse to the point where your partner will steal your identity and make credit and loan applications in your name having access to your joint bank account and takes the money from the account leaving you to pay the debt. Partner intimidation and financial abuse is without doubt an awful situation to find oneself in, and can be magnified if children are present.

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Vulnerability – it can affect us all!

Vulnerability comes in many forms and is rapidly growing in our society. Thankfully people’s vulnerabilities are far more freely spoken about. There was a time when there was stigma attached to admitting to having any form of vulnerability. As a society, we are growing up and are accustomed to hearing about people’s vulnerability pretty much daily. The media have played their part in bringing daily coverage of celebrities that are freely disclosing various vulnerabilities and it is encouraging to see that this openness has had a positive change in how vulnerability is being addressed and how vulnerable people are being treated. It is definitely a step change in the right direction, but more still needs to be done.

One in four people has a mental disorder at some point in their life

Vulnerability includes many different conditions that can affect any one of us at any time of our lives. It makes our coping skills and resilience feel frail and exposed to detriment if the situation is not handled appropriately by the firms and organisations that provide us all manner of financial services. There is no doubt vulnerability is a key issue within the Boardroom of most firms.

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VRS – Self Registration

The Vulnerability Registration Service (VRS) is pleased to note that the Money Mental Health Policy Institutes report Seeing through the fog published 24 January 2017 identifies some common factors in line with the VRS, its service and thinking.

The MMHPI suggests common ways in which mental health problems might affect a person’s ability to manage their finances along with a simple list of what might help. The MMHPI suggests providing control options to help people resist impulses, including giving cooling off periods and the ability to self-exclude from certain types of spending or new credit applications.

In line with the MMHPI report and suggestions, the VRS allows self-registration to vulnerable consumers who can choose an appropriate, non-descriptive proprietary flag fitting their unique situation, a self- registered vulnerable consumer can choose auto decline or refer flags. The auto-decline flag will allow Users of the VRS service to identify vulnerable consumers who wish to self-exclude themselves from certain types of spending or new credit applications. The VRS refer flag lets Users know that the consumer wishes to be taken out of an automated work flow, in essence given a a cooling off period.

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VRS continues to generate considerable interest

The VRS followed up on its successful launch with another well received appearance at the well-respected Credit Strategy – Collections, Debt Sale and Purchase conference in Manchester on the 24 November 2016.

Helen Lord, co-director of the VRS discussed how the platform will work to delegates at the Collections, Debt Sale and Purchase conference, explaining to delegates how the VRS can help protect consumers and provide organisations with a tool to help deal with and support vulnerable people. The presentation was well received and Helen finished her presentation taking open floor questions. A warm round of applause followed Helen when closing the VRS presentation. Find out more about the Credit Strategy conference at http://creditstrategy.co.uk/ 

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A new vulnerability register for consumer credit

The Vulnerability Registration Service Ltd (VRS) officially launched at the Consumer Credit Trade Association’s (CCTA) Going Forward conference in Nottingham on the 2 and 3 November 2016.

Vulnerability is at the heart of many creditor’s agenda’s right now and in a timely fashion the Vulnerability Registration Service has been created with plans to launch in the New Year.

The VRS is an independent private sector initiative with the purpose of protecting consumers and provide organisations with a tool to help deal with vulnerable people. The VRS is run by seven co-directors who all have backgrounds in the consumer credit market. Vulnerable customers will use the platform to record their personal circumstances when they are looking to protect themselves from further debt or related financial problems.

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