How true is it of companies and more crucially management?
A great case study may be Provident Financial (PF) from 2005 to 2017.
2005 YesCarCredit shut down at a cost of £141M due to heavy credit losses.
2012 BBC Panorama alleges that PF were breaching OFT guidelines by offering loans to vulnerable people who may not have understood the loan contracts. Programme featured 2 people with mental illness who were nevertheless given substantial loans,
2014 Central Bank of Ireland fined PF for flagrant breaches of consumer laws.
2017 Restructuring of the entire home credit workforce by replacing 4,500 self-employed part-timers by 2,500 full-timers, supported by a fancy new IT system. Neighbourhoods that had been served by the same agents for years were redrawn and reassigned. New schedules meant they often turned up to make collections when nobody was at home. Debt collection rates plummeted from 90% in 2016 to 57% this year.
2017 FCA to investigate PF’s Vanquis Bank’s Repayment Option Scheme
2017 FCA to investigate Moneybarn, PF’s subprime car finance arm, focusing on whether it properly assesses if a customer can afford to take on credit offered and how it deals with those customers who fall into arrears.