The government is seeking views as it develops a way to provide individuals in debt with up to six weeks free from further interest, charges and enforcement action.
This period would give those affected time to take action by seeking financial advice about how to manage and relieve their debt burden, the government said.
The Economic Secretary to the Treasury Stephen Barclay said: "For many people in the UK problem debt seems impossible to escape. Its effects can be far-reaching, impacting all aspects of a person’s life and leaving them feeling helpless.
"That is why 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."
The new scheme could include legal protections that would shield individuals from further creditor action once a plan to repay their debts is in place.
Old Mutual Wealth responsible business director Jane Goodland commented: “Whilst breathing space for those struggling with problem debt is welcome, we cannot avoid tackling the fundamental issue of a massive gap in UK financial capability.
“The new ‘breathing space’ scheme is yet another example of symptomatic treatment of consumer financial problems. In recent years we have seen numerous interventions designed to tackle the consequences of financial difficulty, from the FCA stepping-in to cap payday lending costs to a ban on pension cold-calling.
“These measures are admirable and will help protect vulnerable consumers. Nonetheless, they are a sticking-plaster to the symptoms of a lack of knowledge and capability when it comes to managing our financial lives. Last week’s FCA survey of consumer financial wellbeing highlighted yawning gaps in our financial knowledge, and these need to be addressed in order to empower people to enhance their own financial health.
“In order to tackle the root cause of financial struggle, more needs to be done to improve financial capability across the board, starting with an effective programme of financial education integrated into the primary school curriculum.”
NEW BUILD IN FOCUS - NEW EPISODE OF THE MORTGAGE INSIDER PODCAST, OUT NOW
Figures from the National House-Building Council saw Q1 2025 register a 36% increase in new homes built across the UK compared with the same period last year, representing a striking development for the first-time buyer market. But with the higher cost of building, ongoing planning challenges and new and changing regulations, how sustainable is this growth? And what does it mean for brokers?
The role of the bridging market and technology usage in the industry
Content editor, Dan McGrath, sat down with chief operating officer at Black & White Bridging, Damien Druce, and head of development finance at Empire Global Finance, Pete Williams, to explore the role of the bridging sector, the role of AI across the industry and how the property market has fared in the Labour Government’s first year in office.
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In this episode of the Barclays Mortgage Insider Podcast, host Phil Spencer is joined by Lucian Cook, Head of Research at Savills, and Ross Jones, founder of Home Financial and Evolve Commercial Finance, to explore how regional trends are redefining the UK housing, mortgage and buy-to-let markets.
In this episode of the Barclays Mortgage Insider Podcast, host Phil Spencer is joined by Lucian Cook, Head of Research at Savills, and Ross Jones, founder of Home Financial and Evolve Commercial Finance, to explore how regional trends are redefining the UK housing, mortgage and buy-to-let markets.
The new episode of The Mortgage Insider podcast, out now
Regional housing markets now matter more than ever. While London and the Southeast still tend to dominate the headlines from a house price and affordability perspective, much of the growth in rental yields and buyer demand is coming from other parts of the UK.
In this episode of the Barclays Mortgage Insider Podcast, host Phil Spencer is joined by Lucian Cook, Head of Research at Savills, and Ross Jones, founder of Home Financial and Evolve Commercial Finance.
In this episode of the Barclays Mortgage Insider Podcast, host Phil Spencer is joined by Lucian Cook, Head of Research at Savills, and Ross Jones, founder of Home Financial and Evolve Commercial Finance.
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