Debt charity, StepChange has announced that it has launched a new Covid payment plan which means that people who have experienced a temporary reduced income due to the pandemic can enter into the new arrangement.
The plan will enable them to make reduced payments on their borrowing for up to a year, providing time for them to get back on their feet and resume full payments once their financial situation has improved.
People have been able to register their interest and undertake an initial eligibility check for the past few weeks, but from today people can complete the entire application, approval and registration process and get the new plan set up. The first payments under the new plans will be taken and distributed to creditors in January. Every penny that people pay goes to their creditors – there are no setup or administration fees.
The new plan is designed for today’s unique circumstances. There are also many other options and solutions available for people facing debt and financial difficulty. It is important to determine the most appropriate option for individual circumstances. The new plan is very much aimed at people who expect their difficulties to be short-lived – recognising that many people face a great deal of uncertainty about their future income in the wake of the pandemic. If the Covid Payment Plan is not suitable, there are other options for people whose problems are more entrenched. If people enter into the Covid Payment Plan but their situation doesn’t improve as hoped, they will be able to change to a different, longer-term form of solution.
StepChange CEO Phil Andrew said “All debt advice charities are gearing up for a big increase in the number of people who are going to need help with debt that has built up due to the pandemic. While the new Covid Payment Plan won’t be right for everyone, it will specifically help those people who have a number of financial commitments but just need a bit of time to get back to normal payments.”
“What everyone should know is that if you’re facing debt problems you don’t need to try to cope alone. Reputable debt advice charities will help you, free of charge. Even if this plan isn’t the right approach for you, various alternative solutions are available that may be suitable, depending on your circumstances.”