Nikki Bond, Research Assistant, Money and Mental Health

Recovery Space - aside from the campaign, what more can essential services do?

“By that point I was so ill, the financial situation to me was irrelevant. I wasn’t really aware of it, apart from the fact that I just knew I couldn’t pay for anything… When it’s such a mountain to climb it just becomes irrelevant.” – Expert by experience

In our new Recovery Space report on the financial harm caused by mental health crisis, we found that nine out of ten people (86%) we spoke to reported having problems paying their bills while they were receiving crisis treatment in the community, or in a psychiatric hospital. Trying to manage accounts, monitor payments and liaise with creditors during periods of acute distress or altered reality can be a near impossibility.

In the midst of a mental health crisis, people’s behaviour may change dramatically, and they can make damaging financial decisions they would not otherwise make when well.  I know this only too well from my experience of working in financial services, where I had daily contact with people in the midst of a crisis, their carers and healthcare professionals. Supporting people who had retained the legal capacity to make financial decisions, but where they had lost perspective, common sense or the ability to think with clarity and exercise sound judgement, was a daily challenge.

When people are too unwell to work, income can fall significantly. Typically when well, a dramatic change in income would prompt many people to contact their bank, mortgage lender or other creditors, communicate their difficulties, and negotiate concessions or alternative repayment plans. For someone experiencing the cognitive and behavioural changes that accompany a mental health crisis, this is often simply not possible. Subsequently bills go unpaid and charges incurred.

Essential services firms' response to people in crisis?

Just as I did, advisors in other essential services firms such as banks, building societies, fuel and telecoms providers, will also have regular contact with people in crisis;  this provides both opportunities and challenges to offering appropriate support.

Our new research explores how these firms currently behave. We found that:

  • People routinely incurred additional charges when in crisis. Direct debits, which when well and in receipt of a regular income serve as a protective tool, can lead to escalating fees and charges when someone is unwell and their income drops.  
  • In making decisions to lend, creditors must ensure a customer can understand, weigh up and retain the information relevant to borrowing. This can present difficulties during a crisis when a customer may be experiencing impulsivity or impaired judgement and their capacity to make financial decision may fluctuate.
  • Data protection processes made it incredibly difficult for carers to simply contact organisations to notify creditors of a person’s mental health crisis and ask for forbearance.

Sarah’s story

Stories like Sarah’s were very familiar to me whilst working in financial services. This case study demonstrates how essential services can assist people, and how the development of advanced planning tools can empower customers to protect themselves when well against times when they are less well.

‘Sarah was a regular visitor to her local bank branch, and would often be accompanied by her partner. She had previously notified her bank of her mental health difficulties so they could assist her with her accounts, as ensuring essential bills were paid on time caused her considerable anxiety, consequently Sarah ran her accounts with scrupulous attention.

On a recent visit to the branch Sarah asked for an increase to her overdraft limit. Staff noticed spending not in keeping with her usual pattern, large payments out to expensive shops and restaurants, and subsequently direct debits for essential bills bouncing.

Sarah met the initial checks for an increase, but staff suggested that she take some time to think this through and discuss it with her partner.  Sarah did not return the following day to progress the application, and on a visit several weeks later when asked about this, she shared that she had not been well.’

What should essential services firms do?

There are few experiences that make a person more vulnerable to detriment than when they are in a mental health crisis. The good news is that there are clear actions that essential services firms can take to mitigate the financial harm caused to people at times of such acute distress.

  • Freezing interest, charges and enforcement action for a time limited period upon notification by a mental health professional that a person is receiving NHS mental health crisis services. This has been the focus of our ‘Recovery Space’ campaign.  
  • Developing processes for receiving and recording information from a third party that would prevent financial detriment to a person’s account without breaching data protection legislation
  • Routinely collecting emergency contact details and a record of the customer’s consent to share specific information or allow limited actions to be taken on their behalf
  • Developing tools and settings to enable people, when they are well, to opt to protect themselves against financial harm when they are unwell, eg: allowing people to set their own weekly or monthly spending limits, opt to block all applications for future credit, automatically prioritise payment of priority debts over non essential debts, request that double confirmation is sought before large transactions are processed etc. For many people with severe and enduring mental health problems, episodic crises will be a recurring feature of their illness. 72% of our research participants had experienced multiple mental health crises. Despite this only 7% of people had set up such protective tools.
  • Providing training for advisors to not only respond appropriately when people report a mental health crisis, but also to recognise more subtle cues that people may be struggling and need additional support.

Extending the government’s Breathing Space scheme to people in mental health crisis is the headline of our campaign, and it’s vital. But while essential services firms are waiting for the government to act, there’s certainly plenty for them to be getting on with.