Is there a relationship between personal debt and mental disorder, and if so, what role does the financial services sector play in this?

Student thesis: Doctoral ThesisDoctor of Philosophy


Introduction: This PhD explores the relationship between personal debt and mental health, with a specific focus on the potential role that debt collection firms play within this. To understand this role, the PhD uses the moment where a customer discloses a mental health problem to a commercial debt collection as a measure of the frequency of encounters between firms and customers with mental health problems, and also as a window to quantitatively and qualitatively study the interaction between collection staff and disclosing customers.

Methods: A systematic review of the relationship between debt and mental health was undertaken, followed by a cross-sectional survey of 1126 frontline telephone debt collection staff in 26 UK collection firms, and an interview study with 34 participants (14 lived experience, 13 collections staff, and 7 leadership management). The systematic review covered the peer-reviewed and grey literature, with a specific focus on any roles that debt collection firms were identified as playing in the relationship between debt and mental health. The survey aimed to (i) provide an account of the frequency with which debt collection staff encountered indebted individuals with mental health problems (using disclosure of a mental health problem as a measure of these encounters), and (ii) establish how the actions staff took following a customer disclosure of a mental health problem compared with a published ‘good practice’ protocol on disclosure management (the TEXAS protocol). Interviews explored (i) the experience of making/receiving a mental health disclosure (including the perceived blockers/facilitators of such a disclosure happening in the first place), and (ii) the resulting interaction between debt collection staff and customers in terms of its perceived negative and positive impacts on customers’ mental health and situation, and the actions and roles that staff and firms took to manage that interaction.

Results: One hundred peer-reviewed and five grey literature papers were included in systematic review. This found some evidence of a plausible relationship among longitudinal studies (n=8/14) of debt contributing to subsequent mental health problems, and an association between debt and mental health in cross-sectional studies (n=15/37). However, limitations in reviewed studies meant it was not possible to definitively conclude this, and almost no consideration was given in these studies to the role that debt collection firms played in this relationship. The PhD’s cross-sectional survey aimed to consider this role and fill this gap. It found mental health disclosures to collections staff routinely occur (with two in every 100 staffcustomer interactions involving disclosure), but a significant proportion of staff do not routinely respond in alignment with published good practice on disclosure management (with five to 25% of respondents not taking certain actions – such as acknowledging a customer disclosure, explaining what would happen to disclosed health information, and asking the customer questions about the mental health problem - during the disclosure). However, staff with more positive attitudes towards customers with mental health problems (less reported reluctance to discuss mental health problems, and less perceived difficulty in discussing mental health problems) were more likely to engage in ‘good practice’ actions compared to those with less positive attitudes. Qualitative interviews meanwhile found that staff routinely identified obtaining explicit consent to record disclosed mental health information as a key action (but, in doing so, this may potentially over-shadow other actions that should also be consistently taken), while lived experience participants valued explanation and relevant questioning of their circumstances. Importantly, lived experience participants – and staff and leadership – also identified actions not contained in published good practice guidance on disclosure management as being central to achieving a ‘successful disclosure’ (including support provision, human kindness and warmth, and feeling understood). Finally, all participants identified positive and negative practice in current debt collection and financial services approaches to interaction with indebted customers with mental health problems, and made recommendations for improvements in the practice and role of commercial firms within the sector.

Conclusion: Debt collection firms routinely have contact with customers with mental health problems, and the disclosure of a customer mental health problem provides an opportunity to adjust debt collection processes to take this into account. However, staff are not routinely taking ‘good practice’ actions, while actions perceived as central to achieving a ‘successful disclosure’ are not contained in good practice protocols – a need consequently exists to re-state what good practice in disclosure is. Based on the survey and interview data, the PhD concludes that debt collection firms can be seen as playing eight roles in terms of the relationship between debt and mental health: (i) ‘makers’ (of contact with customers, and ‘noise’ through collections communications); (ii) ‘signallers’ (shaping customer decisions to reveal or conceal their mental health status); (iii) ‘builders’ (in creating opportunities and channels for customer mental health disclosures); (iv) ‘noticers’ (being alert to mental health difficulties, and starting conversations about these); (v) ‘responders’ (in managing disclosures and taking steps to find out relevant information); (vi) ‘engagers’ (connecting with customers, ‘being human’, and building relationships); (vii) ‘adaptors’ (adjusting debt collection to give support/take mental health into account; and (viii) ‘connectors’ (linking customers to specialist internal and external help). Future research and policy should take these roles into account to better establish the impact that different approaches to debt collection have on customer mental health, as well as being used practically to help both prevent and minimise harm, and create opportunities for customer mental health disclosures at the earliest possible point.

Date of Award1 Jun 2022
Original languageEnglish
Awarding Institution
  • King's College London
SupervisorCraig Morgan (Supervisor), Courtney Davis (Supervisor) & Claire Henderson (Supervisor)

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