CCCS sees sharp rise in online debt counselling

Following on from Monday’s blog post ‘OFT clamp down on misleading debt firm‘ in which we commented about the outlook for the debt industry being one of growth and whilst more businesses and consumers are juggling and /or struggling with debt, the actions of misleading debt firms was unnerving and counter-productive in such difficult times for all.

So it comes as no surprise then to learn that a leading debt advisory charity, CCCS (Consumer Credit Counselling Service) has reported a sharp rise in the numer of people using its online debt counselling tool last month.

The charity reported some 8,600 cases were logged in January for its online Debt Remedy tool, which is twice the number of people counselled online during the previous month and higher than in any month during the whole of 2010.

CCCS reported that a total of 65,825 people received counselling through CCCS in 2010 and the charity unsurprisingly predicts a dramatic rise throughout the rest of 2011.

Increasing demands on household budgets as fuel, food and energy costs spiral higher and higher above the rate of inflation combined with tax changes and lower than inflation wage increases have combined to create the perfect storm of household budgeting constraints.

The outlook isnt much better for business

Currently more than £21bn is owed to small and medium-sized businesses in the UK as a result of their SME’s debtors failing to honour payment terms and the problem, (despite a number of high profile and equally worthless government campaigns) is only set to get worse in 2011.

Some £20,000 is the average amount owed to an SME at any time and nearly half of all UK SME’s had late payement problems in 2010 according to BACS, the company responsible for Direct Debit and

banking transactions.

Late payment problems remains a big problem for UKplc with billions in overdue invoices  causing small businesses to use up millions upon millions of man hours to chase those overdue invoices and it is thought the overall burden of chasing overdue invoices means small businesses typically spend half a day a week just chasing payments.

This figure equates to more than 158 million lost man hours to the UK economy which results in a loss in efficiency costing UK businesses nearly £0.7bn a year which would be put to better use creating value within the respective SME’s that lose these hours each year,

If you are worried about your customers going out of business and incurring bad debt/s as a resultor late payment problems, get in touch with CCDR (Corporate Credit Debt Recovery Ltd) and we can develop a suitable plan for you to manage everything from outsourced credit control through to debt collection and debt recovery or assisting you with debt mediation and/or dispute resolution.