Michael Fitch of Fairpoint Group Plc

We sat down with Michael Fitch, Head of Debt Management at Fairpoint Group Plc, to discuss what he thinks about consolidation, the nation’s tipping point and why debt is no longer such a taboo subject...

1) What exactly does the Fairpoint Group do?

The Fairpoint Group is a financial solutions company; initially it concentrated on IVAs under the Debt Free Direct banner, over the last four years has grown its portfolio to cover a wider range of products including Debt Management Plans.

2) What is your role within the company and how long have you worked there?

My role is Head of Debt Management, and it is my responsibility to oversee the maintenance of our Debt Management clients from the point where the client returns their application back to us, right through to the point where they have successfully got out of debt! I have been in the business for seven months, having moved from my previous role from a similar business. I have been in the industry now for nearly seven years.

3) Could you tell us a bit about the Fairpoint Business Model?

Fairpoint primarily focus on Debt solutions, with the main aim to get people out of debt in the quickest possible time. Each client is different so we have a wide range of solutions to try and make sure we can help as many people as possible. Our company mission is to help our clients make their money go further.

4) What do you think is the biggest issue at the moment in the debt solutions industry?

Regulation. As members of DEMSA we take the care of our clients very seriously. Commercial Debt solutions companies have a major role to play in supporting the people of Great Britain in dealing with the burden of debt; however there are a number of businesses that tarnish the reputation of the sector. The recent OFT Consultation on Debt Management goes some way to starting the process, but there is still a long way to go.

5) What kind of cases do you deal with on a regular basis?

For the area I am responsible for we deal with clients in Debt Management plans. The majority of people we deal with have taken on credit responsibly and then have had a change in circumstances that have made their obligations impossible to keep up with. The economic climate has affected everyone in different ways; our clients just need help to get out of the situation they have found themselves in.

6) Fairpoint has become quite well known for its consolidation of the market, could you explain a bit more about the company’s consolidation and how this will affect Fairpoint’s future?

In the last 12 months we have doubled our client base. Our aim is to continue to grow both organically and through future acquisitions. It is about sustainability, if we think we can add value to a book then we are interested in any proposition, however we need to make sure we continue to offer good service to our existing clients.

7) What do you see happening in the future, particularly with regard to regulatory changes and compliance requirements?

I would hope that things settle down. I think in the next 12 months we will still see a lot of activity regarding the way in which the OFT wants the industry to be regulated and how that is done. When things are a little clearer it is likely more people will exit the market and there will be five - ten ‘main’ providers left who will all have similar compliance, fees and set up. It will then be down to the way in which those businesses deal with their clients to set them apart from the rest. In this industry ‘less’ could actually be ‘more’ – there are so many people in the market that not all are members of DEMSA or DRF which makes it difficult for the OFT to ‘manage’. When there are fewer providers, it will give them the ability to control the industry.

8) If you weren’t working in the debt sector what do you think you would be doing instead?

Tough one, I love to help people, whether that is staff or customers. I have worked in a few different industries so I would more than likely still be in a call centre based role, and likely in some kind of service capacity. 

9) How do you think the industry has changed in the aftermath of the economic crisis? 

The shift from when I first joined the industry has been massive. Debt used to be such a taboo subject and people were ashamed to admit they had fallen into difficulty, and then suddenly you have major corporate banks becoming insolvent and entire countries in billions of pounds of debt. You can’t turn the TV on or read a news article without there being some mention of someone somewhere being in debt. It has led people to be less ashamed of their situations, and as a result people are a lot more aware of their options than they were, say, five years ago. The industry has had to evolve as a result, and the evolution has been to the benefit of the consumer. 

10) Do you expect the country’s financial situation to improve in the coming months?

No. The current state of affairs will not change for quite a while in my opinion. There are a lot of people at ‘tipping point’ and when things like interest rates start to rise again many will be left with bills they cannot pay. The best thing people can do is to try and be pro-active. Be sensible about what you need to spend on, and where possible save yourself money!  

Many people will feel pressured into spending money they don’t have at Christmas; I know some people will miss their mortgage payment this month because they feel too bad about not getting people presents. This is where people like Fairpoint come in, it’s not just about getting people out of debt, but also about helping try to educate people about what their priorities should be so that, once they are out of debt, they don’t fall back into it again.