The Money Advice Service (MAS) has announced that the first Standard Financial Statement (SFS) will go live on 1 March 2017, marking the beginning of a transition period during which creditors and debt advice providers will move to using the new format.
The SFS provides a single set of income and expenditure categories with spending guidelines which will be used across the sector, in a single format. A savings category will also be included to help people build financial resilience while repaying their debts.
Currently there are different formats and spending guidelines in use, including the Common Financial Statement which the SFS will replace. The SFS will bring greater consistency in the way affordability assessments are recorded and considered when considering repayments. Debt advisers and creditors will also be able to pass people’s details more smoothly between different agencies, reducing the number of times affordability assessments are completed and making the journey through debt advice more straightforward.
The development of the SFS has been co-ordinated by the MAS which has brought the debt sector together to form the SFS governance group. This group represents key organisations including major advice providers, creditors, trade associations and insolvency agencies. MAS will continue to work with the governance group over the coming months to monitor the roll-out of the tool and to extend the reach of the programme beyond the financial services sector.