The MoneyPlus story – at the sharp end of the cost of living crisis

The cost of living crisis has wreaked havoc with the personal finances of millions of people.

The rising interest rates haven’t stopped the growing debt bubble, they’ve just drawn more people into it.

MoneyPlus is a Manchester-based debt management solutions provider, which has built a business on helping to get people out of debt by agreeing a sensible way to pay their way back to solvency.

But its founder and chief executive is an unlikely Manchester success story. He grew up in Wythenshawe and was orphaned early in his life.

He’s passionate about his business, almost as much as he is about Manchester United and New Order, but as the business has evolved over its 25-year history, so too are the forces that propel people into debt. Notably, the rise in gambling, but also an awareness of the crushing impact of poverty and debt on people’s wellbeing.

The run up to Christmas feels like a good time to share his story.

According to the Bank of England, consumers spent an additional £1.2 billion on credit cards in November, compared to the month before.

Stats like these, says Davis, show worrying signs of a reliance upon credit in the run up to Christmas, and it’s clear the cost of living crisis will have an impact on the UK’s spending habits and for some time to come, as money borrowed will eventually need to be repaid.

The MoneyPlus offices

The besuited Davis runs MoneyPlus from its headquarters in Manchester with around 170 members of staff, tucked away in an office just across the Irwell from the People’s History Museum, the courts and the financial powerhouse of Spinningfields.

His team provide tailored debt advice, individual insolvency solutions and debt management plans to people who have got into financial problems.

Davis is at pains to stress that the business doesn’t provide loans. “We provide advice and debt management plans, but we capture a lot of data,” he says.

“In order to properly advise a consumer on the best way forward, MoneyPlus need to fully understand their financial position. As such, a significant amount of data needs to be gathered. This data enables MoneyPlus to properly understand the position a consumer is in and leads to the right advice being given. The collation of data also enables the MoneyPlus team to identify trends which they can discuss with their regulator.

He doesn’t think Artificial Intelligence can or should replace what his team do as so much of the customer contact work requires empathy and a human touch – “I’m not sure AI has that yet and we don’t use chatbots” he says.

The business employs a specialist care team – some of whom have experienced hugely traumatic encounters with call-ins who are in an absolute state of despair, some suicidal. He says the team have triaged calls with police officers in order to help people at serious risk of harm.

Davis says that the people who can’t afford the fees that a debt management company will charge to administer a plan or a Individual Voluntary Arrangement get a referred to a charity.

They don’t make the debts go away magically, but they do offer a way out and advice on what to do next.

Davis also feels strongly that too many businesses guilty of misconduct in the financial sector are getting away with driving more people into financial peril and are being unfairly treated because of existing loopholes which enable poor practices.

Davis says he has personally made representations to the FCA to improve regulatory requirements, looking at specific areas of concern. These include; how customers are treated having taken out Buy Now, Pay Later loans, as well as efforts to tighten up the IVA (Individual Voluntary Arrangement) process, which is not currently as tightly managed and regulated as it could be.

“I am worried about a buy now pay later culture,” and says he’s stepping up efforts to lobby the Financial Conduct Authority (FCA).

“MoneyPlus has repeatedly spoken to the FCA about increased regulation in the debt advice sector, such that only firms who can advise on all solutions available, are the firms that can advise each and every consumer seeking debt advice. In essence, a consumer should only speak to a firm that can provide Whole of Market advice.  The present system allows adverts and promotions to be placed by firms that provide only one solution, which creates an inherent conflict.”

The team at MoneyPlus currently looks after tens of thousands of customers each month, with what he says is an exceptionally high success rate.  Davis and his team have seen and experienced how the world of debt has changed over the past couple of decades, and how MoneyPlus has adapted to respond to the changing debt profiles of its customers.

In September this year Davis strengthened his board with the appointment of Michael Shaw, formerly a senior executive and general counsel with NatWest Group and Barclays Group, and before that as a partner at international law firm, Herbert Smith Freehills. Also joining was Deen Khan as head of business performance, with a track record that includes Lowell, Virgin Money, HSBC (First Direct) and St James Wealth Management.

Davis admitted he needed to get these two appointments right, particularly for the storms ahead. “We’ve put a lot of time and effort into identifying and hiring our new chairman and head of business performance, ensuring we appoint individuals who share our core values and principles.

“With their respective backgrounds, Michael and Deen will be great ambassadors for the culture we’re building.”

He says that culture has to be built around care for the staff, mindful of the often stressful work they do. He built a restaurant at the offices in Manchester so the staff always have the option of a quality cooked meal every day, and it adds to an atmosphere of learning, co-operation and skills.

One of the chefs provides diet plans and meal plans for staff who want them. He also enlisted the services of Lloyd Parker, a registered dietitian and performance nutritionist who works with Everton Football Club.

For ten years the business was backed by Manchester headquartered private equity group Palatine, which backed Davis through a series of acquisitions to bolster growth.

“Working with Palatine enabled us to continue our growth and ultimately achieve our aim of establishing Moneyplus Group as a leading provider of financial advice,” he says.

Since 2019, MoneyPlus has pursued a buy and build strategy, expanding its services portfolio and the overall scale of its operations.

But in 2021 Palatine sold out to Intriva, a pan European private equity investor, which has backed Davis and ramped up the acquisitions since, 23 in total at the last count, with an additional £6.5m loan from OakNorth Bank, the ambitious corporate lender with a Manchester operation.

Davis admits it’s a tough business to be in, but seems absolutely driven by a core mission to help people get out of unmanageable debt.

“The core aspiration is making the lives better for all of our customers,” he says.

“Our job as a company in Manchester is to do our bit to help the community. I don’t want a sign in our reception, saying that, I want everyone to hold that ethos throughout everything they do.”