The first debt management companies started in the UK in early 1994 because of the alarming debt situation developing at the time. The economy at the time was still recovering from the effects of increased interest rates from the 1980â ™s and early 1990â ™s. In the 80â ™s mortgage and loan repayments rose, because of interest rate rises and so many people found themselves with much less disposable income.

Also, as interest rates were rising very rapidly, at a much higher rate than inflation, it was almost impossible to save any cash in order to buy products. Credit was the main way to make a purchase at the time.

This created the â ˜buy now pay laterâ ™ environment we know today. This environment also created a vicious circle where people became trapped by debt.