Edinburgh, Scotland -- (SBWIRE) -- 03/17/2014 -- Over 12,000 Scottish citizens sought the help of Citizens Advice Scotland about debt problems last year, prompting the Government to plan a raft of measures to combat the growing problem of debt and bankruptcy. The average amount of debt owed by individuals in financial trouble has reached £15,000 and a significant proportion of these are young adults under the age of 21.
Mr Ewing said today: “This is one of the most ambitious and far-reaching reforms ever considered by both the Scottish Government and Accountant in Bankruptcy.
“The Bill provides access to fair and just processes, allowing debtors to gain control of their debt and their lives and ensures that Scotland leads the way in meeting the rights and needs of debtors and creditors.
Among the changes being brought in, Scottish Citizens with serious debt problems will be able to access financial debt advice before they have to declare bankruptcy, as well as receive information and education about their finances to help them manage better in the future. The aim is to ensure that bankruptcy is always the last resort and not a ‘normal’ option to be considered in with a mix of different debt management products.
Enterprise minister Fergus Ewing said: ”It is vital that people who are experiencing financial hardship have the benefit of advice on the range of options open to them. By taking advice early, many people may be able to avoid bankruptcy by reaching an agreement with their creditors.”
“The reforms provided for in this Bill ensure that our law on debt relief can deal with the challenges we face in modern society, providing appropriate solutions and protection to both those in debt and their creditors.
A spokesperson for Debt Advice Company, Simplefs.co.uk said: “The new reforms will bring bankruptcy laws bang up to date with modern life, helping people to gain control of their financial futures and learning new habits that will support them in their struggle to become debt-free.
“Access to a Money Advisor will give them impartial advice about their finances and help them to make the right decision for their circumstances, while mandatory financial education will ensure that they are able to manage their money properly while paying off their debts.
“However, it’s not just debtors that will benefit. Creditors’ needs have also been taken into account. If less people sequester themselves more money overall will be returned to them, lessening the impact of late accounts and losses on their businesses.”
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