Research suggests that 1.2 million people are now taking out a payday loan every year, borrowing a total of £1.2bn – often at interest rates in excess of 2,000% APR. Although illegal in many parts of the world, the interest rates charges in the UK are largely unfettered, especially since roll-over lending is allowed.
For employers, this situation presents some real challenges; apart from the fact that some employees are finding it so hard to balance their own cashflow, it suggests a level of desperation that might also lead to other vulnerabilities in terms of workplace fraud, theft and deceit. This is by no means intended to cast a slur on people in financial need, merely an observation that severe problems can sometimes lead to severe solutions. It also means that there may well be staff who, whilst present at work, are spending much of their time ruminating on their financial problems and worrying about the lack of obvious solutions. The resultant stress is almost certain to lead to reduced productivity and ultimately to absence. Right Corecare’s view is that we need to work together to halt this spiral of financial crisis.
One of the key components of the Right Corecare Employee Assistance Programme is our debt management service. Designed to support your employees at any stage of their debt concerns, from basic budgeting through to voluntary creditor arrangements, the service has been created to help people who cannot see the wood for the trees, who are finding it very difficult to manage their money and who often are feeling under great pressure. Designed to guide people through their problems, it aims to help the employee take control of their own finances and identify helpful and unhelpful solutions.
By giving your employees some solution options and professional, credible support routes, we can help overcome some of the extreme problems that employees could face by clinging to what they consider to be their only course of action.
For more information about our Debt Management Service, or for details about our wider EAP support, please call on 01489 553000.