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StepChange CIO: The digital foundations of Covid-19 debt relief

The pandemic has forced millions into debt. StepChange CIO Lorna Allan explains how the UK debt charity responded to the crisis by building a new digital service in just eight months.

UK debt charity StepChange has seen a surge in demand for debt management support as a result of the pandemic. It estimates that nearly two million people in the UK who were in a stable economic position before the pandemic now cannot meet their financial commitments. Tech Monitor spoke to Lorna Allan, the charity’s chief information officer, about how it developed a new online service to help these people manage the financial impact of the pandemic – in record time.

Lorna Allan, StepChange CIO
Lorna Allan, chief information officer at StepChange. (Photo courtesy of StepChange)

Formerly known as the Consumer Credit Counselling Service, StepChange was set up in 1993 to provide free debt advice and support for people dealing with financial arrears. Before the pandemic, the charity’s website was visited by more than four million people annually and around 300,000 of those begin a long-term relationship with the charity to clear their debts. The charity pays £400m a year of debt on behalf of its clients.

Two years before Covid-19 struck, the charity had invested in developing its online services, which collect information from applicants that advisers use to determine which debt-management solution to offer. It bolstered its internal development capabilities and implemented a customer engagement platform from Pegasystems.

The aim, says Allan, was to ensure that its customer-facing services were flexible to client needs. Seventy per cent of StepChange clients access its services through a mobile phone, and many of these clients are vulnerable people who are not comfortable using online services. “We have continued to evolve that digital presence into being able to offer a blended service that allows our clients to choose how they talk to us.”

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StepChange’s Covid Payment Plan

That flexibility proved vital when StepChange’s services skyrocketed during the pandemic. The specific impact of Covid-19 on people’s livelihoods – such as being furloughed or having their pay reduced – called for new debt solutions, explains Allan. “We recognised that long-term repayment plans weren’t valid for everybody,” she says. “People have been financially affected but it could be a temporary blip. So we needed to evolve our products really quickly.”

People have been financially affected but it could be a temporary blip. So we needed to evolve our products really quickly.

The charity therefore developed the Covid Payment Plan, a new online service that provides short-term assistance for clients with newly acquired debts as a result of the pandemic. StepChange identified that, given some time and breathing space, these clients are likely to get back on their feet quickly. The Plan, which launched in October 2020, provides a bridge for up to 12 months.

Clients provide responses to six questions, which determine what they owe and what they’re able to pay. Those who qualify complete a more detailed income and expenditure analysis that helps StepChange’s advisers develop an assistance plan. The charity then liaises with creditors to manage the client’s debt. After this, the clients make a single monthly payment until they are solvent enough to exit the program or need to switch to a different debt solution.

The service is provided entirely online. “I can go all the way through from registering, to getting advice, to signing on an e-signature, to getting my plan proposal, to starting to pay my direct debits,” explains Allan. Webchat features of the Pegasystem platform allow clients, for whom dealing with debt can be an emotional experience, to interact with advisers throughout the process.

The groundwork the charity had laid before the pandemic allowed it to develop this service faster than ever before. “We did that in record time by taking our 20 years of experience around debt advice and digitised that service,” explains Allan. “We gathered all that experience and knowledge and achieved the Covid Payment Plan, a much simpler product set, developed in eight months.”

Allan says that the Covid Payment Plan will be in place at least until the end of 2021 and depending on the political and pandemic developments, it might continue in place for longer to help people who are still impacted by the crisis on their financial recovery. “We are here to help people,” says Allan. “And the absolute vision is to eradicate problem debt. So we’re all about trying to help people to recover their financial situation.”

Home page photo by Rommel Canlas/Shutterstock.

Cristina Lago

Associate editor

Cristina Lago is associate editor of Tech Monitor.