Thursday, 30 June 2011

Debt Collection Questions?


The Credit Services Association is the professional body for debt collectors. A bona fide collector will be a member and adhere to the Association's Code of Practice.

As well as the Code, on their website, you will also find useful Factsheets explaining the debt collection process in full, as well as everything you might need for making a complaint.

Tuesday, 28 June 2011

How could the Fairbanking Awards be unfair?

On 14th June 2011, the charity, FairBanking, presented its first four Awards to products that meet its criteria for Financial Wellbeing. Zero-credit questions the fairness of these Awards for the following reasons:

The original consumer research, which led to the development of the Financial Wellbeing Indices is insufficient to correlate findings to the financial wellbeing of the UK adult population as a whole. 

In November / December 2008, a 30 minute online survey was conducted amongst 654 respondents with gross household incomes between £15,000 and £60,000. Approximately 300 questionnaires were completed by each of young workers aged 18 to 29, and family members aged 25 to 39. 

Qualitative research was conducted as a precursor to designing the survey questions and gender quotas, together with a requirement that respondents held a current account, were applied. 

However, in targeting working households of pre-determined age ranges, the coverage of this research was not intended as a total population sample of UK adults and its results cannot apply to this population as a whole.

Furthermore, by conducting the research online, the survey necessarily required a non-probability sample, rendering the calculation of error problematic. Reports show no clear evidence of weighting and as the 2006 MRS guidance on internet research clearly states:

The internet is a limited medium from which to draw a truly representative sample. Research conducted via the internet can only target internet users and, more specifically, it can only target internet users who are prepared to answer online questionnaires.

In 2005, ESOMAR likewise considered issues of non-response, drop-out and survey fatigue in relation to questionnaire length and at 30 minutes, the financial wellbeing of those who chose not to participate fully in the 2008 consumer research is worthy of consideration.

It is also worth noting that throughout October 2008 to January 2009, Communities and Local Government consulted on Digital Inclusion because:

17 million people in the UK still do not use computers and the Internet and there is a strong correlation between digital and social exclusion.  

Reporting the original consumer research from 2008 in “Fair Banking: The Road to Redemption for UK Banks”, the charity’s founder, Antony Elliot, stated quite openly that:

Although these two groups are subjects of the research, it is likely that the conclusions apply more widely to adults in working households with this range of household income between the ages of 18 and 39 – approximately 20% of the UK Adult population. If this assumption is correct the research is relevant to approximately 9 million people.

Thus, at the time of reporting in 2009, the relevance of this research to the wider UK adult population was a) restricted to 20% of that population and b) an assumption - an approach that is entirely in line with professional research reporting.

Despite this, press coverage of the 2011 Awards has undoubtedly taken the view that assessment pertains to the UK Adult population as a whole. For instance, on Monday 20th June, the Daily Mail reported:

In a damning indictment of profit-hungry British banks, just two current accounts in the UK have been judged good enough for a new fair play quality mark.

At what point did assumption become assertion? This is a critical question.

It seems that at some point after the Financial Wellbeing Indices were created in 2008, Fairbanking applied regression techniques to the 7 point Lickert question “How satisfied are you with your overall financial circumstances?” and that from these, a series of component variables for current, savings and credit card accounts were developed. However, to achieve an overall ratings score, components were weighted by a “subjective element” and the origin of this – consumers or a consultant – remains unclear.

In “Fairbanking Ratings: Is UK retail banking showing signs of reform?”, we note that Antony Elliot is no longer the report author, but rather: 

This report is a reflection of many contributions from people both within and outside the banking sector, supporting the aims of The Fairbanking Foundation.

A far cry from Antony’s assumptions in 2009, this document claims a 60% response rate for the charity’s most recent research, which surveyed 45 banking institutions, of which 20 were credit unions. As there are some 48 building societies and more than 280 credit unions that are ABCUL members in the UK alone, never mind however many banks, 27 of these is considerably less than 60%. 

To address non-response, the products of those not approached for original research were reviewed by web-visit, a methodology we ourselves employ when research funding is tight. Appendix 2 sets out the self-assessment questionnaires sent to the 27 participating Banking Institutions and besides that conducted in 2008, no further original research is reported for 2011.

Returning to the Daily Mail article of 20th June it would appear that despite featuring heavily in the credit card section of the 2011 report, Barclays failed to win an Award, because: 

...the High Street giant didn't submit to full Fairbanking testing and so missed out.

How fair is that? The report rated the product highly, but the card did not get an Award? Surely, the Awards can only be fair when based on what is reported from the independent research?

Not only do we question the fairness of presenting some highly rated products as Award winning and others not, but we fail to see how those who have developed products for a niche can benefit from their presentation as mainstream. It is regrettable. We were genuinely impressed by the attention to customer service on a recent visit to Think Banking / Gregory Pennington and can only wonder at their frustration. 

However, perhaps the greatest unfairness is the failure to report accurately what has been rated and by whom, when Fairbanking volunteers have spent two years dedicating their time, energy and commitment to the charity. Whoever is responsible for making such a mess of this worthwhile cause needs to desist.

Monday, 27 June 2011


The response to end legal loan sharking campaign tweets over the weekend has been interesting: accused of denying survival to the most excluded in our society and urged to consider the APR of repaying a friend’s loan, amongst the criticisms.

To those who reiterate that capping is a decoy, I concede that in part, you are right. Far more is needed to curtail the availability of high cost credit, most particularly restricting the number of loans taken, but, for now, this bill will do. It will halt the obscenity of rate increases from 1500% to 4000% in less than three years and for that alone, I commend it to the House. 

Moreover, the campaign to end legal loan sharking has raised awareness of the insidious advance of high cost credit into the mainstream and the lenders hate it. With profits from low-income households spent, these leeches crave the newly squeezed middle, shamed into an illusion of “survival”. 

Heaven forbid that consumers should not consume, but rather invent alternatives as their ancestors did. Good Lord, consumers might actually take the money out of lending and put it back into something productive - we can’t have that!

So desperate is the legal loan shark for money that it plants insecurities between family and friends - you cannot tell, you dare not tell, your dirty little secret... No questions asked, no queues to be spotted in, and the fix of cash in minutes. 

But what the hell is so secret about not having enough money?

When so many are suffering the effects of inflation, why pay for the privilege of pretending otherwise? If we can warn children of the dangers of taking sweeties from strangers, surely we can urge our MPs to put a stop to this most predatory of lending. Be sure to contact yours before Tuesday!


Sunday, 26 June 2011

Insulation for the Nation!


Insulation for the Nation is a fantastic new scheme from benefits entitlement specialists, Income Max. It's energy saving, eco-aware and so money saving that it's free! All you need to do is answer four short questions and you'll have an answer about your eligibility for home insulation straight away. 

What's more, customers who email or call 0300 777 777 2 get a free benefit check too - a far better bogof than many we can think of and a darned site better for your bank balance than a high-cost loan!

Zero-credit recently featured Income Max amongst our quick pick of key Support tools to avoid becoming a victim of changed circumstances. Recent research by the charity CCCS showed that debt problems were far more likely to occur as a result of job loss, illness or divorce than overspending, so knowing where to to go for help quickly can make all the difference.

This at-a-glance Benefits Checklist is another example of how Income Max is making key entitlement information as accessible as possible - due credit for helping us to stay creditfree!

Friday, 24 June 2011

Waste Land


Situated to the North of Rio de Janeiro, Jardim Gramacho is the largest landfill site in the world. It is home to the catadores, or rubbish pickers, who remove around 200 tonnes of recyclable material each day.

Far from being a community at the edge of existence, the catadores formed a co-operative - the Association of Recycling Pickers of Jardim Gramacho (ACAMJG) - to secure welfare for workers and their families. 

In 1995, their contribution to extending the life of the landfill was finally recognised and their work became licensed and formalised to include basic health and safety standards.

Waste Land is a documentary, filmed over three years, that follows the collaboration of Brazilian born New York artist, Vik Muniz, with the catadores. Profits from the artwork sales and the documentary's film festival awards have been shared amongst the catadores through the ACAMJG.

It is still possible to contribute to the ACAMJG, which is currently securing a future for the catadores when Jardim Gramacho closes in 2012. One option is to develop a sustainable recycling system in Brazil that employs the catadores as consultants.Talk about people power!

You can buy a copy of Waste Land on DVD or request a special screening for your community. We recommend you do both - the inspiration of Vik Muniz and the catadores has totally blown us away!


Thursday, 23 June 2011

Help Tower Hamlets CAB!

Tower Hamlets is one of the most deprived areas of London. Its local CAB needs £10,000 to refurbish its premises and you can help. Why not join the charity on this 5 mile walk tomorrow? Alternatively, pledge some money to sponsor those who are walking. Details below:

Saturday, 18 June 2011

A Real False Economy

Earlier this week, The Fair Banking Foundation launched its new accreditation scheme to reward financial services providers for products and services, aimed at improving customers financial well being. The Financial Times, The Daily Telegraph, Money Marketing and the Banking Times all covered the event.

So who are the winners? Well, possibly not consumers, for amongst the awards to date, are two managed bank accounts that charge customers over £160 a year for not having an overdraft. The owners of these apparently award-worthy products are probably not so well known to the majority of consumers, who have not yet endured the poverty premium that is paying piecemeal. Of course, austerity may see to that.

Secure Trust Bank, formerly known as Secure Homes, is as familiar to any social tenant as our old friend and doorstep lender, Provident - a few quid a week and they'll pay all your bills. Our Treasurer, Helen, used to use them - until she worked out what it was costing her, as a lone parent on carer's allowance. We've always called that institutional benefit fraud...

ThinkBanking is, of course, none other than the debt management company, Gregory Pennington. And, of course, their account makes sense if you mismanage your money so dreadfully that you may never learn what is due when, or no bank would have you. But it is far from mainstream. Indeed, it has no need to be, when there are basic bank accounts to be had, for undischarged bankrupts even.

Hell bent on enforcing our dependence on an industry that has cost us billions, the pap we are now fed is that we need specialist accounts to manage our money, because we are incapable of doing this ourselves. Never mind that functional numeracy has remained at the same level (80%) for over twenty years, suddenly, not one of us who is struggling to cope on reduced income, higher inflation and knackt pensions can add up! They want your money...


Friday, 17 June 2011

an invitation to party - kicking butt ;-)


It's been a busy few weeks here at Zero-credit. Our website turned two on 9th June and our Twitter account joins in the Birthday fun on 23rd. However, our origins run even deeper than that. The original "Zero-credit or Bust" book started life at Easter 2008 - it's soon to go on sale in Our Shop.

To celebrate our journey from council house bedroom to consumer co-operative and one of the UK's Top 3 money tweeters, we wanted a party with a twist! In true creditfree style, we have re-crafted our website for the grand total of £135 - an amazing £15 less than we spent on the original two years ago!

What can you expect? Well, our beloved posterous blog is still here of course, rethemed and connected to the rest of the new site, where you can find out about Our Coop, learn more about Our Story and Our Work, meet Our People and join Our Community. Our Shop will go live next week, because there a few more technicalities to sort out and above all we want you to enjoy the experience!

Perhaps our proudest achievement is the creation of a cut-to-chase Tools menu for any borrower seeking to avoid or get out of debt. Here you will find consumer protection, like our new video (above) and useful contacts linking through to the Twitter accounts and websites of over 200 not-for-profit help, advice and support agencies.

You can also explore Planning for digital resources to manage borrowing and budgeting yourself - the choice is yours, because you're a consumer no matter how broke you are! From next week also, a selection of Savings accounts from key mutuals and friendly societies that share our values will go live on the site. And finally, safeguarding you and yours throughout these uncertain times, our Support page connects you to key contacts, calculators and checkers, because we believe passionately that no borrower need ever feel helpless.

So, that's our Birthday present to you. If you want to celebrate with us, simply have a good old mooch around our new site, then comment, like, tweet or share this post! Thank you so much for your support :-)

Tuesday, 14 June 2011

Why The Banks Rule Us

Recently on the @Zerocredit_UK Twitter account, there was a question posted and it got me thinking. I was going to write a comment as I often do on various blogs, but sometime ago I was invited to contribute to the Zero-credit blog and in this my first post, I will respond to the question asked. So what was the question?

If there are more consumers than bankers, why should consumers be jumping through hoops to *understand* personal finance?

Finance is undeniably a complicated subject, with many laws and fines if you don't pay your taxes on time or simply don't understand. Accountancy, for this reason, could be considered as one of the last jobs for life. With personal finance, there are hundreds of accounts, loans, mortgages, and a plethora of other financial products. To help with this, where businesses have accountants, the rest of us have Financial Advisors.

The reality, however, is that many of us can't afford the services of Accountants or Financial Advisors. The best the poorest people can hope for is advice given voluntarily, courtesy of services such as the Citizens Advice Bureau. Their advice I have found is invaluable, and yet the service is shrinking at a time when it is needed most as more of us are getting into financial difficulty following the loss of work and homes.

It is difficult to get a man to understand something when his salary depends on his not understanding it. ~ Upton Sinclair

So the average consumer jumps "through hoops to understand personal finance" because they can't afford advisors explaining it in a way that they can understand? I believe so, but it goes much deeper than this.

I believe the real reason is one of control.

In the song "Re:evolution" by The Shamen, the first line is "If the truth can be told so as to be understood, it will be believed". Do you believe everything your bank says? They may be telling the truth, but even in plain English the banks' terms and conditions are a dozen pages long, if printed at a size we can all read, let alone understand! For that reason, the banks and Financial Services Industry are rarely trusted, a trust which is eroded further with reports such as that of the Barclays Tax Dodging Service for the super-rich. Trust is a necessity to have with organisations who have control of your money.

Money is the biggest incentive for many people, and so to earn money or save money, most people will go a long way to do as they are told if they are getting a good benefit, such as free banking. An example of what we are told is pay a certain amount into your account every month for extra services and higher interest, these services are of very low value relative to the the profits the bank make from consumer banking when their terms are breached. Sadly many people have been with their for years, sometimes the very same bank that persuaded them to join with a 'free' travel card.

So in order to control, people are kept from knowing too much. The application of knowledge is power; too much knowledge of how the system works takes money, power and profits away from the rich. They won't let that happen, just as most of us won't let someone take our money. The strange thing is, even as a wealthy person gets paid more and more, they still want more, they get greedy. Some get caught (remember Bernie Madoff?!) but most just sail their yacht to a tax haven.

How do we change this?

The answer, I believe, is for us to advocate people we can trust, who don't take our money without clear explanation of where it goes and that these people represent the majority of us who lack the skills to navigate the financial services minefield.

Which people? Who chooses? I believe our best opportunity for change is to back a pressure group that promotes what we believe in, such as the Taxpayers Alliance or the massively popular 38 Degrees. Zero-credit has a role to play in this too. Do you think enough people would rise up? Please add your comments below.

Tuesday, 7 June 2011

Squeezed coastlines put the middle at risk

On December 16th 2010, the Maritime & Coastguard Agency (MCA) published a consultation document announcing the Modernisation of the Coastguard for the 21st Century. UK Coastguard HQ Centres are responsible for the co-ordination of Search and Rescue along the UK coastline, as well as providing shipping information and a number of other essential services. Typical emergencies include:

Sailboarders too exhausted to reach the shore 
Walkers and animals who slip from cliff paths 
Boats losing rudder control
Crews stranded aboard container ships, battered by freak waves
Medical emergencies
Incidents involving oil rigs, such as fire 
Suicide victims who have jumped from cliffs or bridges
Missing adults and children around cliffs or beach areas
Broken-down merchant vessels in British waters
Evacuating injured persons at sea
Locating missing persons and vessels at sea
Fires on board merchant vessels
Collisions at sea

Announcing the cuts, Shipping Minister, Mike Penning said "Our seas are becoming busier, with larger ships and increasing numbers of offshore renewable energy platforms making key areas of our seas more congested. There are also increasing numbers of people using our beaches, coastlines and seas for leisure activities.”

So, Mike, you're telling us that with busier seas, larger ships, more offshore platforms and shed loads of us holidaying at home because we're counting the pennies, your government - the one that pledged NOT to cut Frontline Services - is going to rid our shores of ten Coastguard HQ Centres and leave only three operating 24/7?

Public safety is not a toe dipping exercise, Mike. And just because the vast majority of us only visit the seaside for a few days a year does not mean that you can sweep cuts like these under the carpet. We are expecting a total recall on the whole sorry debate before Summer recess, Mike.

To make sure the Government keeps its promise to look again at the proposals, please sign one or both of the following petitions, and if you know of any more local stations that need our support, let us know. We won't be keeping quiet about this one.

National Petition
Milford Haven Petition 

Sunday, 5 June 2011

Tesco Second Hand Car Sales - by @Bangernomics


The UK’s biggest supermarket starts selling cars. It was the worst kept secret of 2011, but now we know that Tesco are now stocking up on used cars. Yes, used cars. You’d have thought that getting into bed with a decent new car broker would have been the easiest way into a notoriously difficult business.

Just how difficult this industry is was demonstrated by the recent demise of Autoquake. Perhaps it proved that the British public weren’t quite ready to buy cars virtually. Well, with a great big blue Tesco sign over the business, formerly known as Carsite, maybe buyers will change their mind?

As much as the thought of a great big nasty corporate entity dominating a market troubles some of us, is it really any different from those great big friendly dealer groups? Of course not, but perhaps a supermarket could teach a bunch of car dealers something, and that could be screwing suppliers.

My theory always was that for bread and butter hatch backed shoppers, why not just stack them in aisle 2? Buyers really don’t love or care about dealers or where the vehicle comes from. So long as the price is right, the car is clean and warranted. Oh yes and the customer service has to be spot on.

Tesco are offering RAC inspected vehicles and nationwide delivery, surely they can’t fail. Well, I logged on and found a Vauxhall Astra Estate 1.6i Design with 24,000 miles at £6300, plus £99 handling fee and delivery to my door at £149. So the cars aren’t that cheap and there really isn’t much in the way of choice, two principles that have served the supermarket well.

Even if supermarkets sell you a shopper, it is unlikely that they will be interested in flogging you a Caterham. Or the sort of depreciated luxury rubbish that I buy. So there will always be room for specialists, people who really know about cars. Then again, there is more than enough room for people who know about customer service.

Selling cars, especially used ones are not like selling cornflakes or even second hand cornflakes. The deals are complicated by a part exchange and customer expectations can be unrealistically high. With Tesco, the cars are not in the aisle, so can’t be test-driven and there’s only a one month warranty. In its present form, I give it a couple of years, tops. 

James Ruppert -
See the brilliant Bangernomics Magazine format and join in the fun at:
Order - The German Car Industry My Part in its Victory, buy the critically acclaimed - The British Car Industry Our Part in its Downfall and the very useful Bangernomics Bible available from Amazon/Play and direct from: