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“Banks should track customers’ personal data” to help avoid debt problems

Banks and building societies could help customers avoid money problems by analysing personal financial data to identify and support people who are struggling, according to the Money & Mental Health Policy Institute.

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Doing so could be particularly helpful for people with mental health problems, who may struggle to manage money due to common symptoms such as memory problems or reduced concentration, the body said.

 

Despite privacy concerns, half of UK adults say their bank or building society should monitor their financial data in this way, while only 12 percent disagree.

 

Based on those findings, the charity is calling on banks and building societies to monitor customers’ data to spot signs of problems, such as sudden drops in income, dramatic increases in spending, or persistent use of unauthorised overdrafts.

 

It wants banks to use text message alerts, for those who want them, or clear directions of where to go for debt advice.

 

Helen Undy, chief executive of the Money and Mental Health Policy Institute, said: “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. 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.”

 

Raymond Pettitt, head of retail segments at Barclays said: “We are always looking for new ways to support our customers to make it easier for them to manage their finances, and are pleased to back this study. We already provide customers with money management tools, such as text alerts, that can help them avoid getting into difficulty in the first place.

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