Money Wellness
Illustration of a woman with the hand of a man covering her mouth
category icondebt
calendar icon16 May 2024

Call for more help for survivors of economic abuse

Changes are needed to help victims and survivors of economic abuse regain financial independence, a new report says.

UK Finance’s latest report looks at some of the obstacles faced by victims when taking control of their finances plus recommendations on how to overcome these.

What is economic abuse?

Economic abuse involves the abuser controlling the victim’s access to essentials, such as food, clothing, their phone or transport. This gives them power over their victim.

It can also involve:

  • preventing someone applying for jobs
  • not letting them go to jobcentre appointments so they miss out on benefits
  • stopping them going to college, university or work

It is a form of domestic abuse that often traps a victim with their abuser. Even if they do manage to leave, the abuse carried out can make it difficult for victims to rebuild their lives. This may force them to return to their abuser.

What is financial abuse?

Financial abuse is a type of economic abuse that involves the abuser controlling how their victim accesses or spends money. They may force the victim to hand over their income or make them take out a personal loan or credit card.

Who can be affected by economic abuse?

Although anyone can be affected, but women are more likely to be victims than men. One in five women in the UK has experienced economic abuse by a current or former partner, with younger women (18-24) more likely to be affected.

Black, Asian and ethnic minority women are also at higher risk of economic abuse than white women.

The charity Surviving Economic Abuse says 95% of domestic abuse survivors have experienced economic abuse and 60% of these have accumulated debts as a result of their abuser.

Our guide has more information about what financial abuse looks like and what to do if you’ve been a victim of financial abuse.

Key issues

Although many financial services firms are signed up to the 2021 Financial Abuse Code and provide support, UK Finance says there is still more to be done.

Three key issues have been identified in the report:

  • debt accrued as a result of controlling or coercive behaviour
  • separation of joint financial services products
  • receipt of payments which are accompanied by abusive payment references

Recommendations

Five recommendations to address the key issues have been set out by the report:

Enhanced, victim-led prevention of economic and financial abuse

  • the option to block payment references from being seen as abusers can send messages to their victims this way
  • sharing best practice across the Home Office, financial services and charities to encourage people to seek help

An “ecosystem” response to deliver support for victim-survivors

  • a ‘tell us once’ service to disclose abuse to multiple organisations to prevent victims from repeating themselves, which can put them in danger
  • for financial services to accept the Economic Abuse Evidence Form information-sharing tool, allowing qualified money or debt advisers to tell an organisation that someone has experienced economic abuse
  • reviewing how coerced debt is shown on credit files

Effective support to give victim-survivors confidence to pursue a fair legal separation of their financial affairs

  • ensuring all victims and survivors can access professional legal advice, with clear standardised information on how to access it
  • for court orders to clearly state that the court can intervene where one party fails to comply with the order or deliberately obstructs the process to continue the cycle of abuse

Effective reporting and criminal prosecution delivering economic justice to victim-survivors and disincentivising future abuse

  • a quick pathway for economic abuse prosecutions and explore how the financial services industry can support prosecutions through the provision of evidence

Policy change to better support victim-survivors

  • The offence of Controlling or Coercive Behaviour should be reviewed to prevent the abuser keeping the proceeds of their crime
  • Reform the Consumer Credit Act (1974) to provide guidance on how to split joint unsecured debt where there is no consumer agreement or Court Order
  • For mortgage lenders to review their lending and allow temporary and agreed adjustment when a victim is looking to become the sole borrower on a joint mortgage.

Call for unfair court fee to be dropped

We’re also calling for the abolition of a court fee that may make it harder for survivors of domestic and economic abuse to rebuild their lives.

It’s not uncommon for survivors of domestic and economic abuse to end up applying for an insolvency solution because they can’t afford to repay their debts.

If you’re granted this type of solution, your details, including your address, are usually listed in the public insolvency register.

Anyone who would be at risk of violence as a result of this information being made public can ask for their address to be withheld.

This is done by applying to the court for a person at risk of violence (PARV) order. But that costs £308.

Asking someone who fears for their safety and is already suffering extreme financial hardship to find over £300 is unrealistic and unfair, so we’re calling for the fee to be dropped.

Coordinated action is needed

Nicola Sharp-Jeffs, CEO and founder of Surviving Economic Abuse, said: 

“Coordinated action is needed to make sure victim-survivors get support, opportunities for control through financial products are closed down and perpetrators are held to account.”

Fiona Turner, head of vulnerability, financial inclusion and capability at UK Finance, added: 

“Economic and financial abuse are horrendous acts, with consequences that can be life-changing, life-threatening and long-lasting. 

“Financial services firms are committed to supporting victim-survivors and already have a wide range of support available. We know that there can be complexities in helping victims regain control of their finances, and the recommendations in this report should help unravel some of these issues.”

If you need help

Economic abuse often goes hand in hand with other forms of abuse. If you are in immediate danger call 999.

If you’re not in immediate danger but are worried about your safety, you should contact one of the following 24-hour domestic abuse organisations:

England

National Domestic Abuse Helpline

0808 2000 247

Wales

Live Fear-Free Helpline

0808 80 10 800

Scotland

Domestic Abuse and Forced Marriage Helpline

0800 027 1234

Northern Ireland

Domestic and Sexual Abuse Helpline

0808 802 1414

Surviving Economic Abuse offers all sorts of help and information for people suffering economic abuse.

 

Avatar of Rebecca Routledge

Rebecca Routledge

A qualified journalist for over 15 years with a background in financial services. Rebecca is Money Wellness’s consumer champion, helping you improve your financial wellbeing by providing information on everything from income maximisation to budgeting and saving tips.

Related posts

debt

24 May 2024

HSBC fined millions for poor treatment of customers in financial difficulty

HSBC has been fined more than £6m for failing to help struggling customers. Find out how lenders are supposed to help if you're experiencing financial difficulties.

debt

20 May 2024

DRO numbers reach record high after fee scrapped

New figures show scrapping the DRO fee has resulted in more people getting crucial debt help. We're now asking the government to go a step further to help domestic abuse survivors in debt.

debt

16 May 2024

Over 3 million people turned to loan sharks in the last year

Millions of people turned to a loan shark in the last year. Find out what to do if you think you’re dealing with one and what’s driving the rise in illegal lending.