Consumers facing financial difficulties due to being victims of economic or financial abuse will get more support in future, an industry trade body says.

Economic and financial abuse occurs when vulnerable people are targeted by others, often a partner who takes control of all or part of their finances.

To tackle the issue provider trade organisation UK Finance has updated its voluntary industry Code, the  Financial Abuse Code of Practice, to give victims of financial abuse more support. 

The Code was launched in 2018 to increase understanding among firms and their staff of financial abuse and how to spot it. 

The Code has been revamped to ensure that it reflects the industry’s “deeper understanding” of victim-survivors' needs, including the treatment of debt. 

Financial abuse is a form of economic abuse reported to be present in 99% of cases of domestic abuse. The National Crime Survey reported 2.4m cases of domestic abuse in England and Wales for the year to March 2019. Since the Covid crisis the numbers reaching out to police and helplines has risen, with service providers such as banks reporting an increase in cases.

Perpetrators have been known to change the ownership of assets and liabilities of vulnerable people while hiding the paperwork so that the liabilities, for example, would be in the victim’s name without their knowledge. 

UK Finance says the Code is now aligned with recent legislative and regulatory developments, including the Financial Conduct Authority’s Guidance on the Fair Treatment of Vulnerable Customers and the Domestic Abuse Act 2021, which for the first time legally recognises economic abuse as a form of abuse.

Twenty-nine institutions covering 39 brands from UK Finance and the Building Societies Association membership have committed to implementing the updated Code, including 14 organisations that have committed to the Code for the first time.

Eric Leenders, managing director of Personal Finance at UK Finance, said: “Financial abuse can take a variety of different forms and the consequences can be devastating for the individual concerned.

“The banking and finance industry is committed to protecting customers from financial abuse and has updated its Code to better reflect our deeper understanding of victim-survivors’ needs. With over 29 signatories and 39 brands committed to implementing the Code, customers can be confident that they will be treated sympathetically and positively in these particularly difficult circumstances.”

Dr Nicola Sharp-Jeffs, CEO and founder of Surviving Economic Abuse (SEA) said: “It is encouraging to see deeper understanding of victim-survivor needs reflected in the 2021 Financial Abuse Code, particularly the new inclusion of debt principles which we called for last year. 

“The updated Code is a further step towards a reality where all financial institutions understand economic abuse.”