TR19/1: Debt management sector thematic review

This report shares the key findings of our thematic review of the debt management sector.

We committed in our 2017/18 Business Plan to assess how the market is operating and whether firms are meeting customer needs and our standards.

Show TR19/1 (PDF)

Who should read this

Our findings will primarily be of interest to commercial debt management firms and not-for-profit debt advice bodies, and the trade and umbrella bodies representing them. Lenders, insolvency practitioners, consumer groups and consumers will also be interested.

What our scope was

This review aimed to test whether firms within the debt management sector are meeting our standards, treating their new and existing customers fairly, and delivering appropriate outcomes, particularly for vulnerable customers. Our work focused on the quality of debt advice given to new and existing customers, and those transferred from other firms, and the services provided to debt management plan customers.

The review included both commercial debt management firms and not-for-profit debt advice bodies. 

What we found


The culture in most commercial firms was now more focused on customer outcomes and managing customer risks from within firms’ businesses. Our regulatory scrutiny and interventions in the sector appeared to be a significant reason for changes in their culture. However, these firms don’t always fully understand the purpose of some of our rules, or the risks their business activities could pose to all or some of their customers.

Quality of advice

The quality of advice has improved since our 2014/2015 review but firms need to work harder to make sure they consistently deliver good outcomes. Most firms were reaching the standards for most of their customers. However, in all firms we found inconsistent practices and some customers that had received poor advice and unsuitable recommendations.

Administering debt management plans

We found firms were devoting more time and resources to administering debt management plans, particularly on engagement with customers to carry out their annual review. However, more improvement is needed in identifying the need to review, and where appropriate adapt or consider the suitability of the customers’ debt management plans, when customers experience changes to their circumstances.

Areas for improvement

There were 2 areas identified where firms need to make significant improvements:

  1. Debt advice given to customers seeking help together or who are already on a joint debt management plan. Some firms routinely failed to consider or discuss what debt solutions are available and suitable for each customer individually.
  2. The identification and treatment of vulnerable customers, including consideration of how an individual’s vulnerability might affect the delivery and suitability of the debt advice and their best interests.

Our expectations of firms

Firms should look at the FCA’s findings and consider the implications for their business. Our report includes examples of good and poor practice to help firms understand the FCA’s approach. 

We remind firms they must be compliant with all relevant rules in CONC and SYSC and our Principles for Businesses.

Next steps

We have given feedback to firms and taken supervisory action where they have not met our standards. Where appropriate, we expect firms to review their past business to identify and put right where customers have not received the quality of advice or level of service expected.

We are taking further supervisory action to address firms where issues have persisted, and have opened an enforcement investigation into 1 firm to date.