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Rules debt management plan providers must follow

This advice applies to England

All debt management plan (DMP) providers must follow certain rules and guidance set out by the Financial Conduct Authority (FCA). These apply to anyone providing debt management services, whether or not they charge a fee.

This page explains more about the rules DMP providers must follow.

How DMP providers are regulated

Anyone providing debt management services must be authorised by the Financial Conduct Authority (FCA) for debt adjusting and debt counselling. This applies to all DMP providers, whether or not they charge a fee.

The FCA also sets out minimum standards that all the authorised firms must keep to. These minimum standards include:

Not misleading you

DMP providers mustn't mislead customers in any of their advertising, marketing or promotion. This includes things like:

  • making sure any materials are accurate, clear and easy to read
  • not making misleading statements, such as telling you their DMP will make you debt-free
  • not saying that the company is working on behalf of the government or a public body

Complain to your DMP provider if you think they’ve misled you - or if another company misled you when they helped you find the DMP provider.

Transparency about fees

If a DMP provider charges a fee, they must tell you how much they'll charge before you agree to the DMP. If they can’t tell you the exact amount they should tell you how they'll work out the fee. They must also explain how any fees you pay will affect the length of your DMP and the total amount you'll have to pay. If they don't, the fees might be unfair. You can check if your DMP fees are unfair and what you can do about it.

Not cold-calling you

DMP providers must not turn up on your doorstep unless they've been invited. They also mustn't send you marketing texts, emails or phone messages without your agreement. If a provider is contacting you in this way, you can make a complaint.

Check what to do if a DMP provider cold calls you. 

Giving you all the information you need

Before you sign a contract with a DMP provider, they must give you certain information about how the service will work, including your right to cancel, how much you'll repay and how long the DMP will last. They must also give you certain warnings in writing, explaining some of the risks of a DMP, including that your creditors might still take action against you or refuse to co-operate. The DMP provider must also tell you how you can get free debt advice.

Check what information your DMP provider must give you.

Advice given by DMP providers

Some DMP providers also give advice. If they do, this also comes under the FCA rules. Any advice a DMP provider gives you should be in your best interests, including whether or not you are offered a DMP. You must also be informed of the importance of meeting your priority debts, including mortgage, rent and utilities payments.

Any advice you're given must include all of the following:

  • a realistic assessment of your financial situation
  • checking your income, for example by asking to see pay slips
  • checking your spending, although standard average figures might be used if appropriate
  • a financial statement - the DMP provider must let you check it before sending it to your creditors
  • warning about what could happen if you stop making payments
  • an explanation of why your debt might increase if you make payments that are lower than the rate at which interest and charges are building up
  • if the plan isn't producing results that are in your best interest, appropriate alternatives including withdrawing

Other rules

DMP providers must also follow other rules, including:

  • referring you to not-for-profit advice organisations for more help, if this is appropriate
  • having measures in place to identify and support particularly vulnerable people, such as those with mental capacity issues
  • keeping you updated about the results of negotiations with creditors or developments in the relationship with them
  • keeping you up to date with any developments or anything that's happened that might affect your DMP
  • provide a statement of account if you ask for one
  • respond to any complaints promptly and fairly
  • give you copies of any correspondence and keep all the relevant information until the contract ends

If you think your DMP provider is breaking the rules

If you think your DMP provider is breaking the rules, you can make a complaint.

Next steps

Check how to make a complaint about a DMP provider,

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