Banks Told to Look Out for Signs of Debt Problems in Customers’ Spending Habits


October 2019

Banks Told to Look Out for Signs of Debt Problems in Customers’ Spending Habits

British banks should be monitoring their customers’ spending to watch out for signs of debt problems, according to a report.

According to research from debt charity the Money and Mental Health Policy Institute, around half of British people think banks should have access to their personal spending habits and should monitor it for signs of problem debt. Just one in ten of the 2,000 people involved in the survey disagreed with the suggestion.

However, around half of the respondents in the survey said they’d be concerned about privacy if their banks had access to their personal data. A third of people believe if their bank confronted them about their financial problems, then they would only feel worse about it.

Those suffering from mental illness were more favour of banks monitoring their financial transactions than any other group. Studies have shown that people suffering from mental health issues are more likely to fall into debt than the rest of society, by either spending excessively to ease depression or anxiety or by failing to open letters and bills.

Some of the suggested solutions for helping people in debt include sending texts when excessive spending is detected, sending supportive information and in some cases blocking transactions.

“Barely a week goes by without a news story about how companies are using our personal data, and the impact that’s having on our privacy and safety,” said Helen Undy, chief executive of the Money and Mental Health Policy Institute. “While these concerns are legitimate, focusing solely on the dangers risks overlooking the enormous opportunity data can present – with the potential to even save lives.

“Around 100,000 people in problem debt attempt suicide each year in England, with many suffering in silence and struggling to ask for help. Something as simple as a bank checking in with a text message if someone’s data shows a sudden drop in income, or signposting them to extra support, could make all the difference.”