Throughout the repayment period, a lender’s continued support can help borrowers make sense of their options, cope with changes in their lives and stay in control of their loan
In the minds of many people, a loan is something that is over the moment an application is approved and the funds are paid out. Before reaching that stage, borrowers might contact the lender’s support staff with questions about eligibility, how applications work, loan terms or what documents are needed.
Even after approval, though, the role of customer support does not fade away.
Across the UK’s regulated lending sector, lending responsibly stretches past the original choice to grant credit. During the term of a loan, personal circumstances can alter, and questions about settling early, repayments or different elements of the contract could crop up at any stage.
With that in mind, support that is easy to reach and continues over time can play a valuable part throughout the lender and borrower relationship.
When Circumstances Shift Following Approval
At the application stage, affordability checks play a central role in judging whether someone can reasonably cope with a loan. Clearing that assessment, however, is no promise that their finances will stay the same for every month of the repayment period.
Over time, changes at work, health issues, climbing household costs and broader living expenses may all squeeze a borrower’s budget.
As a result, a person who met their repayments comfortably at the start could see their financial position shift before the loan term runs out.
With that possibility in view, lenders often ask borrowers to get in contact as soon as they can should repayments look likely to become a struggle.
Ahead of a missed repayment, asking for support during financial difficulty gives both sides room to discuss things before the payment issues escalate.
Having heard about a change of circumstances, a lender can sometimes set out appropriate choices, with the outcome shaped by the borrower’s particular position, its own policies and relevant regulation.
Support Is Not Just for Those Struggling Financially
For borrowers under no financial strain, help after approval can still be relevant.
Partway through a loan term, customers might want to know the effect of paying extra, whether they are allowed to clear the balance early or how an overpayment could alter the total interest due.
In these cases, access to an adviser with relevant experience can make the decision easier to follow.
When it comes to getting in touch, customers also have varying preferences. By offering support over the phone, by email, through online chat or via secure digital messages, lenders let borrowers raise questions and get answers at the time they need them.
For someone anxious about money, clear lines of contact can be especially helpful. A borrower who knows which team to approach and what help is on offer may be less prone to delay asking simply because they are unsure what response they will get.
Quality Service Can Lead to Earlier Conversations
Across the repayment period, continued support is good for borrowers, and it may also let lenders form more open, constructive relationships with their customers.
If the route to assistance is obvious, borrowers may feel readier to flag concerns sooner.
In that situation, the lender has a chance to learn what went wrong and, where it is appropriate and fits with its policies, explore ways forward before arrears mount.
In this respect, the standard of communication also counts.
For simple questions, automated FAQ pages and self-service account features can respond quickly, although some cases need a more individual approach.
Where advisers have training in discussing delicate financial or personal circumstances, set out loan terms in plain words and pay real attention to what customers say, they can deliver support of a kind that automated channels will not always be able to copy.
Pointing Some Borrowers Towards Independent Help
In some situations, the help a customer needs may be better found outside the lender’s in-house team.
In practice, strong support standards can mean pointing customers to charities and other independent organisations that supply debt advice and financial guidance at no cost.
For vulnerable borrowers, or those facing deeper financial trouble, signposting to external support can matter a great deal.
Signposting of this kind acknowledges that some financial issues may need expert assistance a lender cannot supply itself, and it helps consumers identify organisations more able to deal with their particular circumstances.
Lenders’ Duties Carry On After Funds Are Paid Out
Throughout the period in which someone holds a financial product, regulators’ expectations have put more emphasis on how customers are treated. Within consumer credit in the UK, authorisation from the Financial Conduct Authority is one component of the wider framework governing regulated lending.
Under the Consumer Duty, FCA-authorised lenders face a firmer expectation that they will pursue good customer outcomes through the whole of the relationship, instead of focusing chiefly on the sale itself or the opening of a credit agreement.
Seen from the lender’s side, responsible lending therefore goes wider than completing an affordability assessment ahead of approval or setting out charges, interest rates and similar products.
Across consumer credit, short-term loans among them, the same principle holds.
Especially when circumstances change, straightforward communication, easy-to-reach service and quick replies to questions can all help borrowers keep up to date with the terms of their agreements.
Digital Tools and Personal Help Working Side by Side
Thanks to technology, borrowers can now get hold of details about their loans more easily.
Through online account management, customers can see payments coming up and what they still owe, and before applying for credit, consumers can use comparison services and eligibility checkers to find out more.
Online channels and personal support, though, need not take each other’s place.
Among regulated UK lenders, some continue investing in their service teams alongside digital technology, reasoning that convenient online tools and the chance to speak with knowledgeable advisers can reinforce each other. To take one example, Cashfloat, a UK direct lender, makes its lending services digitally accessible and combines this with ongoing support for its customers.
For straightforward information and everyday account tasks, automated services may offer faster, more convenient access. When a question is more complicated, or a borrower wants to discuss private circumstances confidentially, however, speaking to a trained adviser still has real value.
Lasting Help Sits at the Core of Borrowing Relationships
Choosing whether to accept an application is only one part of lending responsibly.
From the first payment to the last, responsible lending also calls for proper standards of communication, and for borrowers to understand where they can go when they want information or support.
When customers are sure how to contact their lender, understand what they must repay and realise they can seek assistance when circumstances change, they tend to stay more closely involved in managing their borrowing.
From a lender’s point of view, support that stays easy to access from the first application until the final repayment is therefore central to running a responsible lending service built around customers.
