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Our CEO Discusses Personal Debt & Solutions Available | Interview

We’ve interviewed our CEO, Marlene Shiels, to discuss personal debt and the solutions available to those who need help.

This is the first of a series of podcasts that CCU’s PR consultant, Stuart Riddell (CCU), talks to Marlene Shiels (MS).

So pour your favourite cuppa, open your notepad, and take notes!

TL;DR – listen to our podcast on YouTube instead:


Marlene is CCU’s longstanding Chief Executive and was awarded an OBE in the Queen’s Honours List in 2016 for her work in financial services and financial inclusion. She currently chairs the Financial Conduct Authority (FCA) Smaller Business Practitioner Panel and is a former board member of debt charity Step Change.

CCU: What is the current position given Covid, furlough, and all that is going on at the moment?

MS: Well thank you Stuart. That’s a very good question and obviously very timeous as we come out of the pandemic. There are government statistics that say that up to 3-5 million more people will be looking at debt solutions, which is a really worrying statistic. A lot of that is down to things like the furlough scheme which is going to be ending soon and what we expect to see is a lot more high street shops closing and a lot more firms perhaps in the hospitality industry that won’t survive either. So at Capital Credit Union we’re already thinking about how we can help our members who might find themselves in a position where they need to look for a debt solution and they haven’t had to that before – so it’s quite a scary landscape for them as well.

CCU: One statistic that I saw is that 14.5 million people have less than £100 in savings so there is obviously a problem with financial resilience at the moment.

MS: Yes, that’s a very worrying statistic, isn’t it? 14.5 million people who don’t have access to a nest egg to fall back on if they experience some sort of an emergency. That could be anything from their car breaking down, to a flat tyre, or their washing machine breaking down. So here at CCU we’re very much about building wealth, we’re very much about building a nest egg, we’re very much about building a financial future for all of our members through saving. And members can save as little as £1 a week and its remarkable how quickly that soon mounts up. It’s our goal to ensure that all of our members have financial resilience and that they have a nest egg to fall back on when they need it – when times get a little bit tough. As I said earlier, we are expecting a lot of people to be struggling and stressed financially over the coming months and years because of the pandemic.

CCU: So Marlene, if I’m sitting at home listening to this and I’m financially stressed what should I do, what can CCU do to help me?

MS: The first thing we want our members to do is come to the credit union. We want our members to talk to us first and foremost because we have so many tools in our toolbox that can help members: whether that’s releasing some of their existing savings, giving a loan to get them through whatever financial challenge they are facing, or getting a consolidation loan to wrap up some debts into one debt to make it more affordable. There are many things we can do as a credit union to help our members who are financially stressed or if they just need an extra helping hand to get them over whatever hurdle. Whatever challenge they are facing at the moment, the message is talk to us first – there’s a lot we can do to help.

CCU: It sounds like communication is absolutely of paramount importance if people are struggling.

MS: Yes, we want people to come to us first. The difficulty is there are so many firms out there that are encouraging people to go down debt solutions that are not necessarily the right solutions for our members. So by coming to us first we can help with products and services in-house we have or signpost to other organisations such as Step Change and Citizens Advice which we have good partnerships with. We work very well with other organisations to give that all rounded support to members. But again, it’s ‘talk to us first’ as there’s lots we can do to help.

CCU: You touched there on the wrong type of debt solutions – can you expand on that a bit?

MS: My concern at the moment is that our members will go seeking debt solutions that are not right for them. There are many solutions that we have here, but if we’re not able to help, we want to work hand in hand with the agencies out there that are finding the right solution for individuals. There are a lot of solutions that are not necessarily good for members because they don’t understand them. What we want to do is educate our members to make sure that they find a solution that is right for them. Quite a number of the debt solutions out there will affect their credit rating and they don’t understand that because these solutions are not very clear. Members often get seduced into a fast solution because it seems that they can walk away from that debt with no consequences. Unfortunately, you can’t walk away from any debt in Scotland without some consequences and usually that will have an impact on your credit rating going forward. Again, the message is talk to us, let us help you find the right solution that’s best for you and doesn’t put you in a worse position.

CCU: If you go down the wrong solution, end up in a worse position, and you say it affects your credit rating, what does that stop you doing going forward?

MS: Well the most obvious thing is if you default on a loan with any lender, including the credit union, and you don’t get the right solution to repay that loan or to have the loan written off but in an orderly way. What happens then is that your credit rating is affected for the future. The obvious consequence is that you’ll struggle to get credit from anywhere. If you do then it’s likely to be at a very high cost because of the risk to the lender now as a result of your previous situation. For anyone looking for a mortgage if you’ve gone down a debt solution which hasn’t been the right solution and you haven’t worked with your creditors in orderly way, then the likelihood is that you’ll struggle to get a mortgage as well. For anyone who’s hoping to get on the mortgage ladder for the first time, it’s really important that if you are stressed or struggling financially that you work with your lender. If that’s the credit union, we’re here, ready, and waiting on standby but work with your lender first to find the best solution to move you forward. It’s important to find a solution so that your credit rating isn’t affected and you can get on with your life financially in the future.

CCU: This sounds, from what you’re saying, that this is a fairly major societal problem. It’s not just one or two people with some debt issues and picking the wrong solutions – this could be a societal issue?

MS: Absolutely and if I go back to what I said right at the beginning, the regulator – the Financial Conduct Authority – expects 3-5 million more people in the next 12 months to be looking for debt solutions. That’s on top of a society that’s already struggling with debt, and has seen our free debt advice agencies actually struggling to cope with demand currently. If they’re struggling to cope now, imagine 3-5 million more people coming into a space where there is not really any additional resources. So yes, it is a societal issue, it is an issue that the government needs to be looking at in a way that supports debt agencies that are providing free advice because they don’t have a vested interest like some of the paid-for debt agencies where it is all about profit not people.

CCU: One of the things that CCU has put together is the Covid Wellbeing Package, which I assume you hope will help tackle this tidal wave of personal debt that’s coming down the line?

MS: Over that last 14 months we have been listening to what our members need, listening to what they’ve been telling us and we’ve developed a whole range of products and services and educational pieces to help our members get over the challenges that are coming down the pipeline for many. So, we’ve taken a whole new approach to the CCU offering. We’ve always offered products, services, and education but we’re now doing that in an entirely different way. We’re working with employers and with other agencies to deliver our Financial Wellbeing Package. We hope this, post Covid, will give everyone an opportunity to get themselves financially fit and financially resilient. We’re doing this through different and new products for members specifically off the back of Covid including our Take a Break loan and Flexiloans, which members tell us they want and need. We’re doing advice clinics and we’re working with employers to reach greater numbers of people who would benefit from saving and borrowing from a credit union. These are people who would benefit from the educational pieces that go along with being a member of Capital Credit Union.

CCU: Some frightening stats that you’ve given us there, Marlene. The obvious answer in the first instance is speak to CCU?

MS: Yes. We’re here, we’re ready, we’re listening, and we’ve got products and services we think our members need – so come to us first. We’ve genuinely got a lot of tools in our toolbox to help members get to where they need to be, to build wealth, to borrow ethically and responsibly, and to be financially fit for the future.

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