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Financial mentors say people with debt are facing increasing levels of harassment and tactics from debt collectors that likely breach the Fair Trading Act.
Financial hardship reached a peak in late 2024, according to data from credit reporting firm Centrix, and while things have eased slightly for households, some of those who took out loans, lay-buys and other credit in the preceding months and years are now fighting to pay back what they borrowed.
There are laws to protect consumers from harassment and misleading behaviour under the Fair Trading Act.
But those working with people in debt say the law is far from clear cut, and there are many grey areas where it becomes hard for consumers to know whether what they are being subject to is legal and in extreme cases debt collectors blatantly flout the law, in order to recoup funds.
Tia Crichton is a financial mentor and Jake Lilley is senior policy advisor at FinCap.
