Phoebus Software comments on the Ofgem announcement of a raised energy price cap in November

Richard Pike, Chief Sales and Marketing Director at Phoebus Software, comments on the Ofgem announcement of a raised energy price cap in November.

“The increase of the fuel price cap to £3,549 is not unexpected, but will undoubtedly concern many families.

“Bearing in mind that a “typical household” is a three of four bedroom house with three of four inhabitants, this will affect a lot of mortgage borrowers.

“Combine this with rising rates for those on variable products, plus the surge of fixed rate expirations expected in the next six months, many will only be able to fix again on higher rates than their existing products. 

“Lenders need to start being very proactive on offering more high-level generic budget planning and guidance on keeping household expenditure to a minimum.

“Of course this goes beyond the norm in terms of pro-active arrears management, but investment in this assistance now will only strengthen borrower relationships for the future and highlight any potential arrears issues sooner rather than later.

“Realistically, there doesn’t appear to be any let up on the squeeze of income to pay for priority bills for most households for the next twelve to eighteen months.

“Utilising specialist portfolio analytics from companies such as MIAC acadametrics should add real value to many lenders.

“In addition, investment in automating standard arrears processes so that time can be spent with those borrowers that really require it.”

Kindly shared by Phoebus Software

Main photo courtesy of Pixabay