External Links:
https://www.equifax.co.uk/white-papers/making-ends-meet-unravelling-the-cost-of-living-spiral
Summary
The Financial Health Report 2023 by Equifax Debt Services provides insights into the current state of UK household finances and offers actionable recommendations for improving financial wellbeing. The report highlights the impact of the cost of living crisis on consumers, the changing demographics of those accessing debt advice, and the need for the industry to work smarter with data and partner with experts to support vulnerable consumers.
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Key Points
- Consumers are relying on new financial solutions, such as BNPL credit, and using savings to pay for essentials due to the cost of living crisis.
- Without further support, more households could fall into debt for the first time due to the mortgage shock expected later this year.
- The report highlights a rise in mid to high earners accessing debt advice and entering into Individual Voluntary Arrangements.
- Equifax recommends working smarter with data, giving frontline teams the skills and tools they need, and partnering with experts across the industry to increase reach and impact.
- The report includes recommendations for supporting vulnerable consumers, ensuring inclusivity whilst adopting digital, unlocking access to social tariffs, and addressing the £18bn in unclaimed benefits.
Key Statistics
- 1.4m consumers could face a 50% increase in their monthly mortgage repayments
- Rise in mid to high earners accessing debt advice and entering into Individual Voluntary Arrangements
Key Take Aways
- The cost of living crisis is impacting UK household finances, with consumers relying on new financial solutions and using savings to pay for essentials.
- The mortgage shock expected later this year could lead to more households falling into debt for the first time.
- The changing demographics of those accessing debt advice highlight the need for tailored support for different consumer groups.
- Working smarter with data and partnering with experts can help the industry engage earlier and more effectively with consumers.
- Supporting vulnerable consumers, ensuring inclusivity whilst adopting digital, and unlocking access to social tariffs are key recommendations for improving financial wellbeing.
- Addressing the £18bn in unclaimed benefits can also help support those in need.
- The report provides valuable insights for individuals, businesses, and policymakers looking to improve financial health in the UK.
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