CCR2 Affordability Assessments & Vulnerability
Shifting dynamics
Questioning and listening skills will be key in determining the impact of personal vulnerabilities on the individual and their business to ensure the right support is offered, at the right time
The shift in employment dynamics is undoubtedly a positive one, reflecting a peak in entrepreneurial drive as people choose to set up their own business, but, for others, it is the outcome of the social and economic environment in which we live, where factors such as high unemployment and increased redundancies offer no other viable alternative.
Whilst many will go on to run successful businesses, for some, factors such as limited financial capability can make them more susceptible to detriment, particularly where this impacts their ability to make informed business decisions.
the vulnerability may have on the business’ operation, and availability of resource. Questioning and listening skills will be key in determining the impact of personal vulnerabilities on the individual and their business to ensure the right support is offered, at the right time.
March 2017
In some cases, it may be a combination of a number of factors, exacerbated by limited financial capability and the lack of business and strategic knowledge, stemming from the absence of expert or professional advice for business-specific information and support.
These factors may make it difficult to decide on business financing needs, which results, in some instances, in a poor and
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costly choice of product. They also raise the key question: could firms be doing more to help create a level playing field? To help address these challenges, we have been working with the industry to define a set of Standards of Lending Practice for business customers, which are designed to plug the gap in existing protections and create a framework for firms, aimed at achieving high standards of conduct.
Launching in March, the standards will bring vulnerability to the forefront of protections for small businesses. However, in the meantime, we could all be doing more to raise awareness of vulnerability, and the impact that it may have on the UK’s small business.
Firms should also ensure there is a read- across for business customers, by sharing areas of best practice, based on lessons learnt in the personal space, to drive firm- wide improvements and deliver consistencies in the treatment of both personal and business customers – offering a firm-led strategic response to vulnerability. CCR2
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