How are debts repaid?

The debt payment programme (DPP) proposal includes information about the payments that the debtor will make on a regular basis and the term of the DPP.  The debtor will make an agreed payment to a payments distributor  who will then distribute money out to the creditors.  This allows outstanding debts to be repaid to the creditors included in the DAS.  The payments distributor contacts the creditor to arrange how the money will be paid.  The payments distributor then makes payments to each of the debtor’s creditors on a regular basis for the period agreed in the DPP.

Although the debtor is required to repay all the outstanding debt included in the DPP, a charge is made to creditors for the provision of the payments distribution service and application fee.  The laws around DAS state the maximum fees that can be charged by both the DAS Administrator and the payments distributor

• DAS Administrator fee is 2%
• Payment distributor fee must not be more than 8% of the amount due to be paid to a creditor through the distributor.

This means that creditors will receive a minimum of 90% of the debt owed to them, if a debtor fully completes the DPP under DAS.