The new guidance will prioritise the quality of information shared on debtors and is targeted at lenders and collectors alike, as the regulator seeks to clarify that its standards apply to all businesses involved in the recovery of debt.
The guidance is being issued in a bid to clamp down on what the regulator (OFT) deems irresponsible or unfair practice in the debt recovery sector.
Of primary concern is failure by creditors to update records or credit reference agency data where it has been established that an individual is not a debtor or has already settled the debt.
Through the guidance the OFT is also seeking to reflect recent changes made to the law and make the debt recovery industry aware of separate guidance recently issued on irresponsible lending.
As part of the initiative a series of workshops will be held by the OFT with industry stakeholders, including representatives from the trade organisations, the Credit Services Association and the Debt Buyers and Sellers Group.
Lenders, tracing firms and credit reference agencies will also participate.
Ray Watson, the OFT's director of consumer credit, (pictured), said: "'Companies should not be using irresponsible and unfair practices to recover money.
"To improve standards and reduce the risk of the wrong person being pursued for payment, the OFT is providing more clarity on the obligations of creditors, tracing agents and debt recovery firms in ensuring the accuracy of data."
Stakeholders wishing to respond to the consultation can view it here: http://www.oft.gov.uk/OFTwork/consultations/current/debt-collection/#named1