Debt advice and IVA company Debt Free Direct is upbeat about its future, saying that it expects to beat its forecasted profit of nearly £10m by at least 10%, a fact which highlights the increase in people seeking help for serious debt problems.

The company, which is listed on the AIM stockmarket, issued an average of 551 IVAs a month in May, June and July, jumping to a record 607 in August, for which the company is thought to be paid around £1,000 each by its customers creditors.

When a customer enters an IVA (or Individual Voluntary Arrangement), interest on their debt is frozen and recovery action is halted, in return for repaying an agreed amount each month. IVAs are increasingly seen as a way out of debt while still stopping short of bankruptcy.

An IVA must be arranged by a licensed insolvency practitioner, and the Insolvency Practitioners Association has complained that in most IVA companies the groundwork is done by unlicenced and unregulated call centre staff before being ’signed off’ by a regulated practitioner, and have called for an official review of the industry.

Debt Free Direct, who have around a fifth of the UK IVA market, say that all their staff are already following the current code of practice and that they have nothing to fear from any government review of regulation or industry practices.

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