The treasury has announced plans to assist those struggling with debt. A 6 week grace period has been suggested to help people have adequate time to act. The intention behind the idea is to allow enough time to find financial guidance and help.
Struggling with debt can be emotionally taxing. It can lead to personal embarrassment for the debtor. When this is the case it becomes harder for debtors to seek advice. With this in mind, a period free of further interest or fees can give time to find a solution. It also allows a debtor a way to gather information, plan and begin repayment in confidence.
Speaking to the press last week, Economic Secretary to the Treasury, Stephen Barclay, said of the plans:
We are working to give people who are overwhelmed by debt more time to seek advice, find a workable solution, and help get their lives back on track. Although many people can and do use credit successfully to manage their personal finances, for the minority who get into difficulties this government wants to offer more support.Stephen Barclay, Economic Secretary to the Treasury
Consumer group leaders cautiously welcomed the idea. While the 6 week period is a positive step, opinion indicates that more work is needed. Citizens Advice Chief Exec, Gillian Guy, added:
Providing breathing space is one way to help people get back on track, but action must be taken to stop them getting in problem debt in the first place.Gillian Guy, Citizens Advice, Chief Executive
Stop the problem early
While the idea is positive, it is clear debt problems must be stopped at the source; rather than further down the line. Debtors require better knowledge and education about managing personal debt.
When a debtor struggles to make repayments, not only do they suffer but their creditors do too. A landlord for example may suffer to make their own payments if their tenant cannot pay. Sole-traders and individuals tend to suffer the most when a debtor doesn't pay. It creates a wider problem the more the amount increases.
When it comes to resolving the issue, often a debt recovery firm is needed to manage the situation. Even with the 6 week grace period, it is important the debtor simply doesn't let it pass by. Doing nothing but put the debt off can make matters much worse.
Debt recovery is much more than collections. It requires tact, planning and expert mediation. With personal debts, those skills are needed to develop repayment plans and to keep check on debtors' situations.
Get the help you need
If you are a sole-trader or SME in need of help, contact the experts. Offering mediation, process serving, legal support and credit checks on top of the collections, AYOM Collections keeps your debt 'good'.
To get in touch about any areas of debt recovery, call us on 0800 130 3357. Lines are open Monday to Thursday from 9am to 5pm (9am-4pm on Fridays). Alternatively you can email AYOM Collections using firstname.lastname@example.org
We also have a simple contact form here. Feel free to ask about any area we cover. We serve the entirety of the UK, collecting both consumer and commercial debts. Get in touch today to see what AYOM can do for you.