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Debt management companies

Many UK debt management companies charge fees for their debt management plans.

Fee-charging debt management companies add their charges to the single monthly payment you make to them under the terms of your debt management plan (DMP).

A standard debt management plan from a fee-charging company could cost you an extra £4,000.

We do not charge any fees for our services. Unlike for-profit debt management companies, we will organise and administer your debt management plan at no cost to yourself and with no hidden fees, so everything you pay goes towards reducing your debts.

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Compare debt management company and not-for-profit DMPs

The table below shows how much (on average) a debt management company charges to run a debt management plan. As we're a charity we don't charge any fees for our debt management plans.

The table also shows how long it'll take to pay off an average debt. As we don't charge any fees for our debt management plans the debt will be paid off sooner, all things being equal.

  Debt management company Not-for-profit organisation
Total debt [1] £17,000 £17,000
Number of debts [1] 7 7
Monthly repayment [1] £200 £200
Initial monthly fees [2] £64.96 (first 6 months) £0
Ongoing monthly fees [2] [3] £36.56 £0
Time to repay debts [4] 8 years and 10 months 7 years and 1 month
Total amount repaid £21,106 £17,000

1. Based on an average StepChange Debt Charity DMP in December 2014 – January 2015 (average surplus £207, 6.5 debts and £17,196 total debt).
2. Based on analysis of the published fees of 20 DEMSA and DRF members on 14/01/2015, including one which charges no DMP fees. 3 of these couldn’t be included because they didn’t publish their fees online.
3. Does not take account of additional costs charged by some debt management companies, such as a charge for carrying out an annual budget review.
4. Assumes that all interest and charges are stopped – this can’t be guaranteed by debt management companies or not-for-profit organisations.
These calculations are for illustrative purposes only. To understand the features and considerations of a DMP please visit our DMP page.

Debt management companies – advertising rules

Any fee-charging debt management company in the UK promoting their services as free is breaking strict advertising rules introduced on 1st September 2010.

In the past, some organisations have been guilty of misleading the public, claiming to offer "free" help and advice in their advertising, even though a typical plan from a fee-charging debt management company could cost around £5,000.

The advertising code states that:

  • Debt management companies are not allowed to advertise a product or service as "free", "without charge" or similar if the consumer has to pay anything other than unavoidable charges, such as response and delivery costs.
  • Financial products must be presented in a way that can be easily understood by the audience, rather than take advantage of consumers’ inexperience.

Debt management companies must also comply with rules set by the Financial Conduct Authority (FCA).

Make sure you never pay for debt help. We provide free, impartial debt help and advice with no hidden charges. Other organisations offering free debt advice include:

If you’re struggling with debts, use our online tool StepChange Debt Remedy, which provides you with the most appropriate solution to your problem.

Who uses our help?

Over-indebtedness largely results from a change in financial circumstances, caused by reduced income or overuse of credit, although relationship problems and changes in employment status are also common causes.

Because of this, our clients are from all walks of life and we are able to offer help and advice to those on high incomes as well as those on low ones.

Has your debt management firm closed down?

In recent months, several debt management firms have closed, some because they’ve been unable to abide by rules set out by the Financial Conduct Authority (FCA).

If the debt management company you've chosen to help you with your debts has closed down or gone into administration, we can help. Please visit our closed debt management company page for more information.

Helping you become debt free...

"I wish to thank your staff for all the great help they gave me when I was in so much debt. They were a pillar of support to me." (Leslie, Essex)

StepChange Debt Charity logo

Foundation for Credit Counselling (trading as StepChange Debt Charity) is a company limited by guarantee registered in England and Wales (Company No: 2757055 ) and a charity registered in England and Wales (Registered Charity No: 1016630). Registered office: Wade House, Merrion Centre, Leeds, LS2 8NG. Consumer Credit Counselling Service (Scotland) trading as StepChange Debt Charity Scotland is a company limited by guarantee registered in Scotland (Company No: SC162719) and a charity registered in Scotland (Registered Charity No:SC024413). Registered office: 33 Bothwell Street, Glasgow G2 6NL. Authorised and regulated by the Financial Conduct Authority.

* Major mobile networks include Orange/EE, O2, Vodafone, T-Mobile, Three, Tesco Mobile and Virgin Mobile. Call charges from other networks may vary.