The ban should save consumers struggling with debt thousands of pounds in unnecessary fees and ensure they receive better quality advice. It will put a stop to the business model which incentivises debt packagers to recommend certain options that make them more money rather than what is in the customers best interest.
The debt packager firms earn money from fees paid when consumers are referred to solution providers such as an Insolvency Practitioner for an Individual Voluntary Arrangement (IVA) in England, Wales and Northern Ireland or, in Scotland, a Protected Trust Deed (PTD).
By contrast, some other solutions may be more suitable for some consumers such as Debt Relief Orders (DRO) in England, Wales and Northern Ireland, or Minimal A…
Read the full article at: https://www.fca.org.uk/news/press-releases/financial-watchdog-bans-referral-fees-debt-packagers-help-struggling-consumers