Shop Direct Finance debt? Here’s what to do

April 27, 2021

If you’re dealing with Shop Direct Finance debt, you’re not alone. For decades, catalogues from retailers associated with Shop Direct have been a popular way to get items immediately, while paying in instalments.

Most adults today have catalogue brands etched in their childhood memories. Whether it was Argos catalogues cluttering the sofa, or Littlewoods leaflets on the floor, catalogues were the obvious way to access clothes, school supplies and birthday presents if money was tight.

But buying from a catalogue can be a very costly way to borrow, especially if you can’t afford what you’re buying in the first place. While you can make the minimum monthly payments each month, you can rack up so much in interest or charges that you are paying these off rather than the actual debt.

In this article, we’re going to cover exactly how to deal with debt from Shop Direct Finance, and how you can move forward from the burden of living on credit.

How can I deal with debt from Shop Direct Finance?

You can deal with debt from Shop Direct Finance by checking whether you actually have to pay the debt, contacting Shop Direct to see if they can lower fees and interest on your debt, knowing your rights against your creditors and budgeting so that you can pay off your debt faster.

You can also refuse to take out more credit, seek support from a debt charity, practice psychological tactics to deal with debt like the debt snowball, consider debt consolidation and find an insolvency solution like an Individual Voluntary Arrangement (IVA) or Debt Relief Order (DRO) if it’s appropriate.

Who are Shop Direct Finance and what do they do?

Shop Direct Finance are the financial services part of Shop Direct, a digital retail group who recently merged to become The Very Group.

If you’ve ever had store credit or catalogue debt with Shop Direct, Littlewoods, Very or ISME, it is usually Shop Direct Finance who will contact you about it, and remind you that you owe money.

While it can be very stressful to deal with calls and letters about debt, there are a lot of things you can do to manage the situation. Let’s look at them now.

9 steps to deal with debt from Shop Direct Finance

See if you actually have to pay the debt

In some cases, you may not even have to pay your Shop Direct Finance debt at all. If it’s been 6 years since you were sent a default notice for your debt and you haven’t made any payments to or written acknowledgements since, your debt may be ‘statute barred’, which means it is too old to be collected and unenforceable in court.

Similarly, if you didn’t sign a credit agreement with Shop Direct (now, Very), your debt may not be enforceable.

Contact Shop Direct

It’s always worth contacting Shop Direct (now called Very), and seeing if there is anything they will do to help you with your debt situation. If you find yourself unexpectedly out of work and it’s too difficult to keep up with catalogue repayments, for example, they may offer you a different repayment plan. All catalogues owned by Very are registered with the Financial Conduct Authority (FCA), which means that Very have a legal obligation to contact if you’re suffering with ‘persistent debt’ with catalogue accounts. ‘Persistent debt’ is defined by the FCA as when you pay more in interest and late payment charges than you do towards your actual debt. At first, Very will encourage you to pay more on your balance if you can, but after 36 months of persistent debt, they are obliged to offer you ways to pay off your debt within three to four years. This might include a more affordable payment plan or options to suspend interest and charges, or reduce your monthly minimum payment (however, this could impact your credit file). It’s a good idea to seek free debt advice from a charity before your catalogue account is in persistent debt for 36 months, but at least the persistent debt warnings will help you realise when the credit you’ve taken out is costing you too much and offer you some options for help.

Know your rights against Shop Direct Finance

Shop Direct Finance are regulated by the FCA, which means that they (and any debt collection agencies they may engage to contact you about your debt) are bound by certain rules. Creditors and debt collectors in the UK are not allowed to:

  • Persistently contact you either by phone, letter or in person, as this counts as harassment.
  • Contact you on any social media websites, for example, Instagram, Facebook and Twitter.
  • Behave in a physically, psychologically or verbally abusive manner.
  • Force entry into your home
  • Contact you outside of 8am-9pm on working days, or at all on weekends and holidays.
  • Call you at work, unless you’ve given them express permission to do so.
  • Let your employer, family, friends or colleagues know that you owe a debt or that they are a debt collector. Even implying this is against FCA regulations.
  • Make false allegations against you, or pretend that they have powers which they don’t, for example, that they have the power to take your belongings or send you to prison (debt collectors don’t have these powers in the UK, and it’s not a criminal offence to be unable to pay catalogue debts)
  • Add on interest or late charges which weren’t specified in the original credit agreement or contract you signed with the Shop Direct catalogue.
  • Imply that legal action can be taken against you if it can’t.
  • Provide falsified documents or impersonate bailiffs or legal authorities.
  • Use jargon or complicated language to confuse you
  • Pressure you to sell your home to pay off the debts
  • Pressure you to take out more credit to pay off the debt
  • Try to embarrass you in public
  • Enter your home without permission.

See the Financial Conduct Authority (FCA) handbook, for your full list or rights against creditors and debt collectors. If a debt collector breaches any of these rules, you can complain to the Financial Ombudsman Service (FOS).


One of the most effective ways to pay off catalogue debt fast is to budget carefully, and put anything you save towards the debt. Try the Three Accounts Budgeting System, developed by debt charity Christians Against Poverty. With this system, you’ll have three bank accounts – one for your direct debits (this includes things like rent and mortgage, car insurance and debt repayments), one for your weekly spending and one for savings.

Make a list of all your expenses (including debts). When you get paid your income (salary or benefits), divide the money up among the accounts, making sure that you have enough to buy the essentials such as food and petrol, as well as cover the payments for your debts.

Set aside the amount of money you need that month to pay your rent, bills, and anything else you pay via direct debit and put it into your direct debit account. Next, put the money you’ve allocated for your weekly spending for, for example, your family’s food shop and the occasional treat, into your weekly spending account, which should be a basic cash account, with no overdraft. Whatever you have left, you can save towards emergencies, or fun occasions like birthdays.

Debt snowball

Get motivated to pay off your debt faster, with this psychological debt tactic. With the debt snowball method, you start with the smallest debt first, and focus on paying that off while making the minimum repayments on your other debts. This means that you get the sense of success from completely paying off a debt earlier than you would if you carried on chipping away at your larger debts. When you’ve paid off your smallest debt, you then focus on your next smallest and so on until they are all paid off. However, if you’re dealing with a lot of high-interest debts on catalogues, you might find the debt avalanche method more effective, which is when you focus on paying off your highest interest debt first, saving yourself more money in the long run.

Don’t take out more loans

If you’re struggling with debt, the best thing to do is avoid taking out any more credit at all. Look out for government and charity support that can help you pay for essentials if you’re struggling to afford them. If you earn below a certain amount or are unemployed, you could be entitled to benefits like Working Tax Credit, Child Tax Credit or Universal Credit, which could improve your finances and help you pay off debt. Your local Citizens Advice Bureau can help you with support, including:

  • A Discretionary Housing Payment (DHP) from your council, to help you pay rent.
  • Getting your benefits paid early.
  • Welfare assistance from your local council in the form of vouchers to pay for things like furniture or household appliances. This could be a lifesaver if, say, your washing machine breaks and your only other option for getting one would be taking out a loan.
  • A no interest loan from the government
  • Grants to help with different expenses. Make sure you check out the charity Turn2Us which has a Grant calculator, and shows what grants you could be entitled to in your local area.

Consider debt consolidation

If you’re juggling a lot of high interest debt on store cards and catalogues, you could consider debt consolidation. This is when you take out a low interest loan with a decent repayment term and use it to pay off all your catalogue debts, then and there. You’re then left with one manageable, low interest payment to make every month (the loan), rather than several high interest ones. However, it’s only worth considering debt consolidation if you credit score is actually good enough to access a low interest loan. Make sure you check any low or 0% interest borrowing periods on consolidation loans, and make sure you can pay back the loan before the 0% interest period ends, or you could suddenly find yourself with very high interest to pay off.

Debt consolidation options include:

  • 0% interest credit cards. Use the credit card to pay off your high interest catalogue debts, and then focus on repaying the credit card, which should give you lower rates of interest to deal with and more manageable repayments.
  • Low interest bank loan. Use the money from the loan to pay off your overdue catalogue accounts, and then focus on repaying the loan.

Be careful to read the fine print on any debt consolidation loans you consider, as some credit cards or loans charge extra fees for use, particularly if you’re transferring money or balances. Always check if the consolidation method is financially worth it, and make sure you can pay off the loan within the low interest period.

Find an insolvency solution

If you’re in serious financial distress, and you have too many debts to reasonably repay, you could consider an insolvency solution. The UK government offers various solutions that will write off some or all of your debt, although they will affect your credit score until they are discharged (ended). The solutions include:

Individual Voluntary Arrangement (IVA)

An IVA allows you to pay back a small percentage of your total debt, and get the rest of it cleared. At the end of the IVA (which runs for 5-6 years), no matter how much you still owe, the debt is written off, and the IVA will drop off your credit record after it has ended. You will make small, monthly payments towards your debt, based only on what you can afford, after you have paid for your basic living expenses. If you already have a County Court Judgement (CCJ) due to debt, an IVA will reverse this. At IVA Advice, we offer free, expert advice on IVAs, so if you think an IVA might be the right solution, feel free to give us a call.

Debt Relief Order (DRO)

You may be able to get a Debt Relief Order (DRO), if you don’t own any valuable assets such as your own home, and you can prove that you have less than £50 in disposable income. A DRO gives you legal protection against your creditors (they are no longer allowed to contact you about the debt) and writes off your debt after around 12 months. If you have a CCJ, it can be included in a DRO.


While bankruptcy does write off your debt, it has a serious effect on your life and credit rating. You can’t be the director of a limited company during your bankruptcy, so it can affect your career if you manage a business. In some jobs, you may have to tell your employer that you’ve gone bankrupt, although this is rare. Bankruptcy will clear your debt after around 12 months, although you may have to sell assets to pay off your creditors. You should always seek free debt advice before deciding to go bankrupt, and it should always be a last resort.

Get support from a debt charity

Debt charities like StepChange, Christians Against Poverty and National Debtline offer free, expert support if you’re struggling with debt. In some cases, they can offer free debt management plans and negotiate with creditors on your behalf, saving you the stress of dealing with them alone.

Now that we’ve covered the different ways you can deal with Shop Direct Finance debt, we hope you’ve found this helpful. Remember that the best thing you can do is contact a debt charity and start actively dealing with your debt, whether that is through a debt management plan or other solution, so that you can enjoy the debt free life you deserve.

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