Introduction to Debt Management Firms 

Under Part V of the Central Bank Act 1997 (as amended) (the “Act”) a “debt management firm” is defined as meaning:

a person who for remuneration provides debt management services to one or more consumers, other than an excepted person[1]

The Act defines “debt management services” as meaning:

“(a)       giving advice about the discharge of debts (in whole or in part), including advice about budgeting in connection with the discharge of debts,        

(b)         negotiating with a person’s creditors for the discharge  of  the  person’s debts (in whole or in part),  or

 (c)       any similar activity associated with the discharge of debts”.

Under the Act, a person who meets the definition of a debt management firm is required to obtain authorisation from the Central Bank in order to provide these services. Please also note the Act identifies a number of “excepted persons”.

Please also note that the definition of a debt management firm identifies that it is remunerated for these services. The term “remuneration” is also defined in the Act.

Any person who provides services in relation to debt management should consider, in conjunction with their legal advisors, if their activities fall within the scope of the Act and therefore will require to be authorised by the Central Bank.

Please note that a firm authorised as a debt management firm will not be authorised to hold client funds except where it holds another appropriate authorisation such as an authorisation as a payment institution and / or a money transmission business pursuant to the European Communities (Payment Services) Regulations 2009 or Part V of the Act respectively.

[1] As defined in Section 28 of the Act.