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Industry welcomes revised collections letters 12 OCTOBER 2020

Industry welcomes revised collections letters
2 minute read

The announcement of new rules for collections letters last week (Wednesday 7 October) seems to have been broadly welcomed across the collections and recoveries industry.

The new rules are:

  • Default notices will now need to avoid threatening language and be accessible.
  • Legal terms will need to be explained in a more straightforward and understandable manner (plain English).
  • The use of capital letters is out - bold or underlined to be used instead.
  • Free debt advice must be signposted.

They are expected from December this year and creditors have six months to comply.

CCA and default notices

Default notices in particular have a special place in the collections compliance team’s heart. They are, after all, required as part of the Consumer Credit Act (CCA), and needed to ensure any debt is enforceable through the legal system.  

As such, any variation, testing or changes to tailor the message, must be compliant.

Make the change today

However, this being said, there is little in the CCA that stops many of these elements being done today, and in fact many leading organisations already do. Some of this is simply best practice and does not necessarily need to be legislated.

And, of course, this applies not only to default letters but all letters in collections. 

Ensuring all letters are clear in language, offer the customer options on next steps, and signpost debt advice and help really helps customers and any arrears, as they generate the best response. Being polite and professional helps of course too!

With lockdown, we saw how easily and quickly changes to letters could be made… is it time to make the most of this and update your letters today?

At Arum we have plenty of collections letters, design, and implementation experience, with clients across multiple market sectors. Contact us if you would like to find out more.


Chris Warburton
Principal Consultant



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