Record fall in consumer debt –  business news  30 July 2020.

30 July 2020.

James Salmon, Operations Director.

A record fall  in consumer debt while mortgages bounce back, working remotely continues, house price growth slows, furlough, Covid-19, markets, and other business stories we have seen.

Here are CPA we want to  share the business news stories we have seen that we think will affect our members and readers. Many of us are busy fighting to protect our businesses and therefore might have missed some of the news that could impact small businesses, their owners and those that sell on credit.

Record fall  in consumer debt while mortgages bounce back

The Bank of England (BoE) says the amount consumers owed on credit cards and loans fell by a record amount over the last 12 months.

A slump in borrowing and spending since March has seen the amount households owe on credit cards and loans fall from £225.3bn in February to £207.1bn in June, marking a 3.6% drop on the amount outstanding in June 2019.

The reduction in outstanding debt is the largest year-on-year fall since records began in 1994.

Alistair McQueen at Aviva said households “have repaid five years of credit card debt in just five months”.

Howard Archer, senior economic adviser at the EY Item Club, said: “Consumer confidence remains well below the levels seen in February which is likely to be encouraging many people to cut back on their borrowing if they can.”

Meanwhile, BoE figures show mortgage approvals increased to 40,010 last month, a significant jump from the 9,300 recorded in May.

The Bank’s monthly money and credit report said: “The mortgage market showed some signs of recovery in June but remained relatively weak in comparison to pre-COVID,” with figures showing that February saw 73,700 mortgage approvals.

No rush for office returns

A survey of 94 of Britain’s biggest employers by the Chartered Governance Institute and governance recruitment specialist The Core Partnership shows half plan to keep all staff working remotely for the next few months, a fifth plan to bring staff back to the office only on a part-time basis and around a fifth plan to bring staff back full time. The Times notes that PwC is planning for about half of its 22,000-strong UK workforce to return to the office by the end of September.

Pandemic to deliver work shift?

Craig Vickery, head of ACCA Scotland, looks at what the coronavirus crisis will mean for firms, reflecting that while the physical world of work “looks likely to be very different”, the nature of work and the skills needed may also see a shift. He says the ACCA has “been at the forefront of upskilling and re-skilling our members to equip them to face the ever-changing world of financial services”.

EU rules on business loans eased

More small firms will be able to secure government-backed loans under the coronavirus business interruption loan scheme after the European Commission (EC) agreed to relax competition rules which had prevented some accessing emergency support due to their debt and accumulated losses. The Treasury has agreed with the EC that businesses in this category with fewer than 50 employees and a turnover of less than £9m can now apply for the loans

Prime house price growth slowest in 11 years

House price growth in global prime residential markets slowed to the lowest rate in 11 years in June, with Knight Frank’s prime global cities index increasing 0.9% in the year to June, down from 2.3% in March. London was one of the poorest performers, with prime property prices down 5% in the 12 months to June and 3.7% in Q2.

Minister warns against extending furlough scheme

Steve Barclay, chief secretary to the Treasury, has cautioned against extending the government’s furlough scheme, commenting: “For people to be out of the labour market for too long period is not a good outcome.” The scheme has now cost the taxpayer £31.7bn, an increase from £29.8bn a week ago, according to new data.

Meanwhile Caroline Abrahams, director of Age UK, remarked: “For the sake of employers as well as their staff, we call on the Government to implement a new furlough-style support scheme at the current 80% level for workers who are shielding or who are exceptional risk from the virus, if August 1 is too early for them to return safely to work.”

Covid-19 general news

Global cases pass the 17 million mark with deaths passing 667,700.

Almost 10,000 people in the U.K. have been given an experimental Covid-19 vaccine from AstraZeneca Plc and the University of Oxford, a key step toward finding a shot that will help control the pandemic. Johnson & Johnson wants to start Phase 3 trials of its vaccine in September.

Prime Minister Boris Johnson warned  the pandemic is far from over, and said there are “signs of a second wave of the pandemic” in European nations. “It is absolutely vital as a country that we continue to keep our focus and our discipline and that we don’t delude ourselves that somehow we’re out of the woods or that this is all over, because it isn’t all over,” he told the BBC.

America’s Federal Reserve has repeated its vow to protect the US economy amid rising coronavirus rates and worries about growth. It warned that the country’s economic outlook depends on the course of the coronavirus pandemic. Jerome Powell, the Fed chair, said “the pace of recovery looks like it has slowed” since infections started rising again in June. The Fed pledged to keep interest rates near zero and maintain its emergency economic support. Markets reacted positively to the news.

Germany reported the highest number of new cases in about six weeks and its economy shrank by a record 10% in the second quarter.

Melbourne, Australia is back in lock-down after a new covid-19 outbreak. The whole state of Victoria has been closed, but not before the virus sneaked into next-door New South Wales.

Japan has just recorded 1,000 daily cases for the first time.

Medical researchers in South Africa found a “huge discrepancy” between the country’s confirmed Covid-19 fatalities and the number of excess natural deaths, providing further evidence that the number of people who have perished from the disease is higher than the government reports.  The Country has the world’s fifth-worst epidemic, with 471,123 cases with  7,479 Covid-19 reported deaths to date


The FTSE was flat yesterday as the market failed to react meaningfully to a busy day for company earnings announcements. Overnight the DOW rose 0.61% the  S&P 500 rose 1.24%. and the NASDAQ rose 1.35%. The US Dollar however tumbled again overnight after the rather uneventful FOMC rate decision. Sterling and Euro are the stronger currencies, taking turns to be the best performer.

Analysts of technology stocks will be busy today. After the bosses of Alphabet (Google’s parent), Amazon, Apple and Facebook were grilled at a congressional hearing yesterday. The bosses of America’s biggest tech firms defended their business practices at a congressional antitrust hearing against charges that they tried to “neutralise the competition”. Jeff Bezos, Tim Cook, Sundar Pichai and Mark Zuckerberg also fielded questions on election meddling, content moderation and privacy.

Japanese Trade

The United Kingdom is on the verge of signing a free trade deal with Japan, with the agreement set to be closed within a matter of weeks. Negotiations, which began just six weeks ago, have reportedly reached a breakthrough point with the dialogue at an “advanced stage”, according to a government source.

Pre-pack hit Monsoon creditors

Unsecured creditors of Monsoon Accessorize are owed more than £132m after founder Peter Simon bought it back out of administration in a pre-pack rescue deal managed by FRP. The administrator’s proposals show that creditors include landlords, suppliers and local authorities, with the Times noting that potential returns to unsecured creditors remain unclear and depend on the realisation of assets by FRP and the claims agreed.

Aston Martin errors see losses understated

Aston Martin understated the scale of last year’s losses, after its new owners identified discrepancies in payments to US dealers dating back to 2018. Pre-tax losses in 2019 were understated by £15.3m as a result, with the firm making a loss last year of £70.9m compared with an initial figure of £55.6m. Chief financial officer Kenneth Gregor blamed a “simple error or misunderstanding.”

Wolfson in digital tax warning

Next boss Simon Wolfson has warned that a digital sales tax could hurt the high street by hitting the click-and-collect model. Lord Wolfson said of the mooted levy: “There is a potential for a massive own goal [from the Treasury],” adding: “It could severely reduce the number of people going to the high street if click and collect is taxed.”

FRC fines BDO for first time

BDO has been fined £200,000, reduced to £160,000 for early admission of errors, by the Financial Reporting Council for rule breaches in its work on international insurer AmTrust Europe’s accounts. Jamie Symington, Deputy Executive Counsel to the FRC, said: “The failings in this case related to an area of high audit risk, namely the consideration of an insurance company’s approach to its provision for claims. The Auditors relied on the opinions of independent expert actuaries without taking sufficient steps to gain an understanding of or to evaluate their work.” The FRC said the fine, which included a reprimand for BDO partner David Roberts, reflected that BDO and Mr Roberts have a good compliance history and disciplinary record with no prior sanctions. BDO is required to implement a training programme to improve how it obtains and evaluates independent actuarial audit evidence. The firm said it was “extremely disappointed” that its audit work did not meet the required standards, adding that the shortcomings had been addressed.

HMRC withdrawing more APNs than the number it issues

New figures reveal that HMRC withdrew more tax demands sent to those suspected of using unlawful avoidance schemes than were issued in 2019. Some people who received such Accelerated Payment Notices (APNs) have sold their homes or taken out loans, before demands were later withdrawn. Richard Morley of BDO remarked: “It’s all very well for those with the means to pay, as if the APN is later withdrawn and the individual is vindicated they will get their money back. But for those who can’t pay they have to raise the money or risk penalties later down the line if they refuse to pay straight away,” while a spokesman for HMRC defended APNs, saying they had “successfully changed the economics of avoidance” in recent years.

Don’t let Covid-19 bust your business!

It will if your cash flow dries up, either sooner or later.

The Credit Protection Association (CPA) has been assisting thousands of UK businesses to get paid since 1914. We have seen many financial crises, this one will be particularly deadly for suppliers for sometime to come.

CPA eases cash from tardy debtors – Efficiently, Effectively, Economically and Ethically. Above all tactfully, because maintenance of goodwill is paramount.

To meet the needs of creditors in the current crisis, we have designed a “critical care” package especially tailored for the situation.

  • The annual package costs start at very low rates
  • A minimum performance warranty is provided
  • Several complimentary services included

Clients instruct CPA on-line via their PC or phone, completely user-friendly. Your late paying customers are told to pay you direct (not to us).

A very recent report shows a 23% increase in the number of unpaid invoices since March 11th THIS YEAR – are you getting a build-up of late payers?

 Right now, overdue accounts must be a concern and CPA has a great track record of encouraging slow-payers to pay their suppliers quickly.

It takes less than 17 minutes to see how you would benefit, do you have the time now?

No face-to-face meeting required – just call Peter Uwins, CPA’s National Sales Manager, on 020 8846 0000 (business hours) or email today.

When you see your money come in, you will be so glad you used CPA.

Do you sell on credit?

With pressures on the cash flow it is essential that you stay on top of the credit limits you grant customers and watch carefully for any late payments.

Those customers will look for the easiest option  to boost their cash-flow. Don’t let it be you.

You can’t just assume your customers can and will pay you eventually, no matter how big their name is.

It is essential to have credit management systems in place to monitor and check your customers credit worthiness.

It is also best practice to use a trusted third party like CPA to make sure you are paid on time by customers, no matter how good a name they have.

About CPA

The Credit Protection Association can help!

Formed in 1914, CPA has been providing credit management services to SMEs for over 100 years.

At the Credit Protection Association, we provide first class credit information that can help you avoid being over extended to customers who are at risk. Our monitoring service can flag up warning signs long before the end, giving you the chance to adjust and reduce your exposure. We provide recommended credit limits and credit scores on a traffic light system and can help you set appropriate credit policies for your customers.

We regularly publish lists of the latest insolvencies but by then it is too late. Our credit reports however predict approximately 96% of company insolvencies long before they arrive.

Companies in trouble usually have very bad cash flow and they try to deal with it by delaying payment to their suppliers, increasing your exposure to them.

If you supply on credit, help us help you identify the risks.

Why use a third party collector?

As a third party collector, we can also get your payments prioritised over those who are not as hot on collections. When your customer receives a letter from the Credit Protection Association regarding their outstanding account, they are going to want to get that resolved as a priority. Our overdue account recovery service can get your unpaid invoices to the top of their “to do” list and get your invoice paid.

Over the years we have collected billions in overdue invoices for our customers.

Our debt recovery and credit management services give our members the financial freedom needed to grow and prosper, while our new Late Payment Compensation department could unlock hidden potential and offer the compensation needed to springboard your business to success.

You might be hesitant about contacting a debt collection agency. What are they going to be like?

Can they help your particular type of business?

There is no need for concern. CPA are courteous, helpful and very probably have had direct experience of working with your type of business.

Debt collection agencies are not all alike.

Success lies in both recovering money and keeping customers happy. The Credit Protection Association was founded in 1914 and  has helped tens of thousands of UK businesses to collect outstanding payments and reduce the risk of incurring bad debt. We believe that creditors deserve to be paid for the work or goods they have supplied but we fully understand the need to maintain
the best possible relationship with customers!

At The Credit Protection Association, we provide solutions, advice and back-up in all areas relating to the supply of services or goods on account. Client-members receive everything they need from a single source to reduce debtor days and write-offs.

The Credit Protection Association has helped has assisted tens of thousands of UK businesses with their credit control requirements, since the First World War.

We are polite, firm and efficient when it comes to recovering outstanding debt.

“We have used CPA for a number of years now. The website is easy to navigate around with lots of helpful reports. The staff are always at hand and very friendly. CPA has  helped us reduce our debt over the years and keep track of potential issues with our customers.”
~ CPA client in Buckinghamshire

“The service from CPA has proved to be everything that you said it would be. We have already seen a huge benefit. We have had a number of overdue accounts paid promptly and directly to us. It is also a huge weight off our mind to know that once we have passed an overdue payment over to you, you take care of everything whilst keeping us informed.
~ Credit Controller client in Warrington

The Credit Protection Association – Prompting Punctual Payments – Ethical, Effective, Efficient, Economical collections


Ready to speak to an advisor?

For help or advice on credit management, entirely without obligation.

Call us today

0330 053 9263

CPA is passionate about late payment

The Credit Protection Association has been protecting smaller firms against poor payment practices for over 100 years.

We are extremely passionate about breaking the late payment culture that holds back the UK economy and threatens many SMEs with cash flow difficulties being the single biggest killer of Britain’s small businesses.

If you were regularly paid late we can help. Those former customers used you to boost their own cashflow, regularly paying you late.

As a result you had extra costs, you had the distraction of having to chase payment, you had opportunity costs because your capital was tied up in their late invoices.

Under little used legislation, you are entitled to compensation for those late payments.

Now you can boost your own cash-flow.

CPA can help unearth the those hidden treasures.

We have the technology to reveal the compensation you are due and we have the extensive experience and expertise to then turn those claims into cash.

Yes, CPA can help you boost your business cash-flow.

Don’t let your bankers control you, contact CPA today.

The Credit Protection Association – Prompting Punctual Payments – Ethical, Effective, Efficient, Economical collections

Read our blog here on how to crack down on the late payment culture.

Read our blog here on how to give late payers the slap they need.

The “Why” of the late payment culture.

New PM should walk the walk and back small firms over late payments

Paying late is “crack cocaine” to big business.

Late payment culture risks “spiraling out of control”

visit our late payment compensation page

See our full blog and FAQ on late payment compensation

Do you realise you could be sitting on a fortune?

Late payments often result in a cash flow crunch and leave SMEs in need of a cash injection.

If you sold B2B on credit then there may be a hidden source of capital you can call on.

If you fancy an bit of extra cash in your business, rather than jumping through hoops with your bank, you could look to uncover the resources from an unexpected source within your own business.

Not many are aware but there could be a hidden fortune within your business, sitting there, just waiting to be uncovered and released.

We can help you uncover the pile of gold, you didn’t even know you were sitting on.

If you trade with other businesses and were often paid late then you could be entitled to significant compensation.

Under little known and under-utilised legislation your business could be due huge amounts in compensation that you didn’t even know about.

Let’s be clear – this is not a way to weaken any customer relationships you value. It is one that identifies who’s been paying late and then recover the potentially significant sums in compensation using Late Payment Legislation from businesses where the relationship has already ended.

You can pick and choose who you want us to follow up – but once we’ve agreed which companies you’d like to pursue compensation from it’s a fast process and there’s no financial outlay to you whatsoever. My team at CPA put its expertise to work to recover the compensation due and fight late payment culture.

That compensation could provide the cash boost your business needed.

But don’t delay, that compensation evaporates if not claimed within six years of the late payment.

How can CPA help?

CPA has developed a unique technology to dig into your accounting records and discover the cash injection you are due by means of compensation. The software does all the hard work. Our software interacts over the cloud with over 300 different software packages, working directly with your accounts package, just so long as it’s stored on a computer.

We recognise that most companies do not have the resources to spend time on the identification and calculation of Late Payment Compensation. Our service can produce an Analyses within just a few days with (usually) less than 30 mins of co-operation from our clients. We work directly with over 300 accounting packages but can also work with bespoke accounts packages. Indeed, speed is essential as the oldest invoices may fall foul of the 6-year time limit.

Once the Sales Ledger Analyses is made available to clients, all that is required is that management decide which commercially sensitive ex-customers to remove from the list and return it to us.

CPA then uses its years of collection experience to explain and recover the Late Payment Compensation Claims. Clients do not handle any part of the recovery process as our team will take all communications from the companies against who the claims has been made. Often, it’s simply a case of explaining the legislation, sometimes we have to go all the way and enforce the legislation through the courts.

The result is that we are realising clients’ claims worth tens and sometimes hundreds of thousands of pounds which, of course, is pure net profit.  You may also be among the recipients of “hundreds of thousands of pounds” should you elect to take advantage of our services.

We do the work, you receive the cash.

If you have supplied goods and services to businesses on credit and were regularly paid late then you could be due significant sums in late payment compensation.

We are talking to companies and unearthing claims in the hundreds of thousands from former business customers who paid them late. Large business customers who abused their power to inflict unfair and sometimes illegal payment practices.

We are helping business owners  who are looking to boost the returns from their business before they retire. We are helping businesses who have lost major clients after years of loyal service to get properly compensated for systematic late payment. We are helping companies that were looking to close down, who looked insolvent and finding that cash injection they need to avoid insolvency.

Those former clients who regularly paid you late can finally be made to pay.

Ready to speak to an advisor?

For help or advice on credit management, entirely without obligation.

Call us today

0330 053 9263

The Credit Protection Association is a credit management company established in 1914. If you supply goods or services on credit then we can help you!

The Credit Protection Association – Prompting Punctual Payments – Ethical, Effective, Efficient, Economical collections

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The Credit Protection Association – Prompting Punctual Payments – Ethical, Effective, Efficient, Economical collections