What is Debt Management?

A Debt Management Plan is an agreement between you and your creditors to pay all of your debts in full.

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Debt management plans are useful if:

  • You can only afford to pay creditors a little amount monthly
  • You have debt problems but unable to the full repayment for a period of time
  • You do not want to enter a formal solution
  • You are struggling to keep on top of your current repayments and need to re-structure to regain stability

You can arrange a plan with your creditors yourself or through a licensed debt management company for a fee. If you arrange this with a company you make one repayment to the company and they divide the money to your creditors.

You may incur charges or fee’s from a company to set up a debt management plan however there are some free services you can find through the money advice service, their details are provided at the bottom of the page.

A debt management plan is an informal solution and it aims to put all of your existing creditors ideally into one monthly manageable payment for you.


  • One affordable payment to the DMP company
  • Payments can increase or decrease depending on your situation.
  • Creditors can sometimes freeze interest however they do not have to do so.
  • Certain organisations will do this free of charge you can contact the MAS for more information on this.


  • For the DMP to be effective all creditors must agree to the arrangement offered.
  • Most providers will charge for this service (Management fees are generally 50% of the first 6 months of payments and a monthly fee on average of £38 per month.)
  • Interest and charges are not guaranteed to be frozen.
  • Your credit rating will be affected.

Money Helper

Money Helper is an important service set up by the Government. They provide free debt counselling, debt adjustment and credit information.