Help if you need it

Government today issued advice on getting financial help for those who need it. This is for those worried about paying utility bills or repaying credit cards, loans or mortgages. The guidance below sets out the steps you can take to get the support you need.

Energy suppliers

We are told energy companies will seek to identify and prioritise customers who may need additional support. This will take into account Priority Service Register customers, prepayment meter customers, and vulnerable customers. Based on individual circumstances, firms may offer support such as:

  • reassessing, reducing or pausing debt repayment and bill payments for domestic customers in financial distress
  • referring customers who are struggling to pay to third party debt advisers such as StepChange and Citizens Advice
  • suspending credit meter disconnections

Water

All water companies have measures in place for people who struggle to pay for their water and wastewater services, these include:

  • continuing to help customers pay their bills through WaterSure, Social Tariffs and other affordability schemes
  • actively offering payment breaks or payment holidays
  • adjusting payment plans urgently to help with sudden changes in household finances
  • simplifying the processes for customers to get extra assistance
  • helping customers get advice on benefits and managing debts, particularly for customers who have not been in financial difficulties before

Telecoms

Firms are asked to:

  • prioritise support for customers who might be struggling to pay their telecoms bills, offer advice on managing telecoms debt and strengthen their work with consumer bodies such as Citizens Advice and other organisations who could help these customers
  • offer options to struggling customers, such as a payment plan, a cheaper tariff, or a delay on their payment
  • avoid disconnection for struggling customers, treating it only as a last resort

Mortgages

At the start of the pandemic in March, the Financial Conduct Authority published guidance setting out their expectation that firms offer mortgage payment holidays. Mortgage holidays allow customers affected by coronavirus to defer making up to 6 monthly mortgage payments (although interest will still accrue during this period). Alongside this, the FCA and government have been in close contact with mortgage lenders and administrators to make sure they treat consumers fairly during the coronavirus pandemic. Further measures agreed with lenders include:

  • providing consumers with options when their payment holiday comes to an end to ensure they continue to get support they need
  • not repossessing homes before 31 January 2021, except in exceptional circumstances

For more information on managing your money during and after the coronavirus pandemic, you can also use the Money Advice Service’s Money Navigator Tool.

Loans, credit cards overdrafts, motor finance and other forms of credit

The FCA has also stepped in to make sure those having temporary difficulties meeting loan or credit commitments due to coronavirus can request payment deferrals of up to 6 months in total, on:

  • a personal loan, credit card, store card or catalogue credit product
  • motor finance or leasing payments
  • buy-now-pay-later agreements
  • rent-to-own agreements
  • pawnbroking agreements

If people are having temporary difficulties meeting payments due to coronavirus, they can also request a payment deferral on a high-cost short-term credit loan for at least 1 month.

Consumers have until 31 March 2021 to apply for an initial or further payment deferral. After that date, they will be able to extend existing deferrals to 31 July 2021, provided the extensions cover consecutive payments, and subject to the maximum 6 allowed.

Consumers who have already had 6 months of payment deferrals or who are receiving tailored support will not be eligible for a further payment deferral. Instead, firms will provide tailored support appropriate to the customers circumstances. This may include the option to defer further payments.

Consumers who are struggling with the cost of their overdrafts as a result of coronavirus will be able to request support which reflects their individual circumstances, as set out in the FCA’s tailored support guidance published in September 2020. This could include reducing or waiving interest.

The FCA has full information on eligibility.

Council tax

Each local authority has its own Local Council Tax Support (LCTS) scheme which provides reductions in council tax for low-income residents. There may also be other support available, including through the range of discounts and exemptions that can be applied to council tax. Further detail is available in the Plain English Guide to Council Tax.

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