Manx Financial gets FCA go-ahead for debt collection subsidiary

Financial services company Manx Financial Group has obtained a variation of permissions from the Financial Conduct Authority (FCA) for its wholly-owned subsidiary, Manx Collections (MCL), to manage and collect debt on behalf of third-party lenders operating in the UK.

The AIM-traded firm said it remained committed to UK lending, both regulated and unregulated and, as such, saw an opportunity to capitalise on its existing successful infrastructure and compliance resource to service debt recovery.

It said MCL would operate in accordance with best practice on behalf of lenders who did not wish to manage the process for themselves.

By implementing “compliant and structured” debt settlement programmes, Manx said MCL expected funders to be able to continue lending to companies with strong underlying fundamentals but currently at risk or in default as their businesses recovered and adapted to a post-Covid-19 world.

“As the small-to-medium enterprise debt burden continues to grow, an increasing number of vulnerable companies are liable to default on their loan obligations,” said MCL executive director Douglas Grant.

“It is imperative that lenders do not compound this cycle by only supporting sectors and businesses that are resilient and have been agile enough to already adapt to the new economy.”

Grant said FCA approval would allow MCL to work with businesses facing problems using debt adjusting and debt counselling permissions to review and restructure exposures.

“We believe these permissions will assist others in ensuring that debt is managed in line with good conduct and ‘Treating Customers Fairly’ principles.”

At 0849 BST, shares in Manx Financial Group were down 2.97% at 7.52p.