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- Can you move your plan to a different provider?
- When is it worth moving to a different provider?
- What do you need from your current provider before you move?
- How do you check the new provider before you sign?
- How do you cancel the old plan without leaving a gap?
- What can go wrong during a switch?
- Is switching provider always the right fix?
- Related guides
- Frequently asked questions
You cancel one arrangement and start another, and nothing in law stands in the way. There is no transfer process, because a debt management plan is not a statutory scheme and there is nothing to transfer.
What is binding is your contract with the provider, not the plan itself. The creditors are not parties to it.
Part of your pay is protected by law
The deduction is set by statutory tables, not the creditor
An arrestment can be stopped or replaced
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So the whole question turns on two contracts and a handover of paperwork. Your creditors are not being asked to approve anything.
What follows is when a move is worth making, what to get out of the old provider, how to check the new one, and where a switch can go wrong. Whether you can cancel at any time deals with ending an arrangement outright.
Can you move your plan to a different provider?
Yes, at any time, and you do not need anyone’s permission. What binds you is the contract you signed, not the plan.
Why there is nothing to apply for
A debt management plan is an informal arrangement rather than a statutory scheme. No Act of Parliament creates it, nothing prescribes its form, and it binds nobody by force of law.
No register records a plan, no form starts one, and no office holder is appointed. A switch is therefore an administrative matter rather than a legal one.
Read the contract before you stop the direct debit
CONC 8.4, which is a set of rules, requires a firm to give you a written contract and requires that contract to set out the duration and the conditions for exercising any right to cancel.
Your contract may set a notice period, and nothing statutory imposes one. Read it before you cancel the direct debit.
Your creditors are not part of the decision
No creditor has to accept a debt management plan, and nothing requires one to give a reason for refusing.
They will be written to by whoever is running the arrangement. None of them has to agree to the change of provider, because none of them agreed to the first one either.
When is it worth moving to a different provider?
When fees are taking a large share of your payment, or when the provider has stopped doing what the rules require of it. Nothing published records how often people move or why, so the questions below are the ones worth checking against your own paperwork.
The reasons worth checking
| The reason | What to look at first |
|---|---|
| Fees are taking a large share of the payment | Your last annual statement, which has to show the fees and charges taken |
| Creditors say they are not being paid | The provider's distribution record against the creditors' own statements |
| Interest has not been frozen on several accounts | Whether the provider told you the outcome creditor by creditor |
| No review has happened for over a year | The review is required at least annually or on a material change |
| You want a provider that costs you nothing | Whether the new one takes Scottish clients and offers Scottish solutions |
| You are being sold a solution rather than advised | Whether the firm holds the permission for what it is selling you |
CONC 8.8.1, which is a rule, requires a firm to keep in contact with you, to monitor your position, and to review, amend or terminate the plan at least annually or as soon as it learns of a material change.
What the rules say about fees, precisely
There is no cap. CONC 8.7.2 is a rule requiring that a firm’s fees do not have the effect that you pay substantially all of them before your creditors are paid, and that they do not undermine your ability to make significant repayments starting with the first month of the plan.
CONC 8.7.3 is guidance, and it says the Financial Conduct Authority is likely to treat more than half of your monthly payment going to the firm as breaking that rule.
That is a threshold at which a rule is likely to be broken, not a permission to take half. Whether plans are free or charge fees sets out the whole position.
A payment that has become unaffordable is a different problem
Changing provider does not change your income, and a new provider will build the same budget from the same figures. Changing your payment when your income changes is usually the first thing to try.
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What do you need from your current provider before you move?
A full set of account details and an honest account of what each creditor has agreed. Ask for it in writing before you cancel anything.
The handover list
| What to ask for | Why it matters |
|---|---|
| Every creditor's name and reference | So the new provider writes to the right people |
| The current balance on each account | So the new offers are built on real figures |
| What has been paid to each creditor | So you can check the arithmetic yourself |
| Which creditors froze interest, and which refused | The provider has to tell you this under the rules |
| The fees and charges taken to date | So you know what the arrangement has actually cost |
| Any money the provider is still holding | So you can ask for it back before you close |
The interest question is not optional for the firm. CONC 8.8.1, which is a rule covers telling you where a creditor has refused to freeze interest or charges accruing.
Ask whether any of your money is being held
Ask whether the provider is holding any of your money rather than passing it straight on. Ask what the balance is, and ask for it to be returned when the arrangement closes.
Client money is protected while a firm holds it
The Financial Services Compensation Scheme covers money held by an authorised debt management firm up to £85,000 per eligible person per firm for failures on or after 1 April 2019.
It does not cover debt advice itself. Protection attaches to the money, not to the quality of what you were told.
How do you check the new provider before you sign?
Look the firm up on the Financial Services Register and read its permissions, not just its entry. Authorisation for one thing is not authorisation for another.
The register is the only check that counts
The Financial Services Register lists every authorised firm and the permissions it holds, and the Financial Conduct Authority tells firms to check their own permissions there.
Permissions can be limited, and the regulator publishes wording such as limited to debt adjusting excluding the conclusion or administration of debt management plans on its limitations page.
A firm carrying that limitation cannot run your plan, whatever its website says. How to check a firm is authorised goes through the search step by step.
Charities are regulated too
Not-for-profit bodies holding the debt counselling and debt adjusting permissions are authorised in the same way, though the Handbook’s defined term debt management firm expressly excludes a not-for-profit debt advice body, so some rules written for firms do not bind them.
What authorisation does and does not buy you
It gives you a complaint route to the Financial Ombudsman Service and compensation cover for client money. It does not mean the regulator has approved the plan, the fees or the advice.
How do you cancel the old plan without leaving a gap?
Line the new arrangement up first, then cancel, then cancel the payment method last. The order matters more than the timing.
The sequence that avoids a missed month
- Get the account details and balances from the old provider in writing.
- Choose the new provider and check its permissions on the register.
- Complete the new budget and agree the payment before you cancel anything.
- Cancel the old arrangement in writing, and keep a copy.
- Cancel the old direct debit only once the new one is set up.
- Tell your creditors yourself that the arrangement has moved.
Expect a month where nothing looks right
Creditors update their records at different speeds, so letters can cross. Keeping your own record of what was paid and when is the fastest way to sort it out.
Do not stop paying while you decide
A gap in payments is what turns a switch into a problem, because creditors are not obliged to hold off and may still take court action.
What can go wrong during a switch?
The two real risks are a creditor acting during the gap and an interest freeze quietly ending. Neither is stopped by anything in the plan.
A plan holds nothing back
A plan does not stop enforcement. It has no statutory effect on diligence at all.
In Scotland that means a creditor can raise an action, obtain decree, serve a charge for payment and then instruct diligence. Whether creditors can still take court action sets out the sequence.
A frozen account can unfreeze
No creditor has to freeze interest because you are on a debt management plan. No statute requires it and no Financial Conduct Authority rule requires it.
A creditor that agreed to stop charging did so voluntarily, and a change of provider is a fair moment for it to look again. Whether a plan freezes interest explains the rule and guidance distinction behind that.
Payments reaching the wrong place
Debts get sold and reference numbers change, so a payment can land against a closed account. Check the first two statements from each creditor after the move.
Is switching provider always the right fix?
No. A cheaper provider does not change what a plan can do, and in Scotland what it cannot do is often the real problem.
What free actually means
| The point | A free provider | A fee-charging provider |
|---|---|---|
| Who pays | The credit industry pays the charity | You pay, out of your monthly payment |
| What comes out of your payment | Nothing | Whatever the contract says, and there is no cap |
| What the rules require | Fees must not undermine your ability to repay from the first month | The same rule applies, and the guidance threshold sits above it |
| Who is regulated | Both. Not-for-profit bodies holding the permissions are authorised too | Both |
| The complaint route | The Financial Ombudsman Service | The Financial Ombudsman Service |
StepChange is funded by creditor contributions, at an average fair share rate of 10.33 per cent in 2024, which comes out of what creditors receive rather than out of your payment.
Christians Against Poverty says its services are completely free because churches and individuals donate, and lists debt management as available in Scotland.
The statutory routes do things no provider can
Under the Debt Arrangement Scheme the freeze is automatic and statutory from the day you apply.
Approval of a debt payment programme also recalls an arrestment of your income or property, which no provider can do for you. Moving from a plan to the Debt Arrangement Scheme sets out how that works.
And you can run the arrangement yourself
Dealing with creditors direct costs nothing and needs no authorisation, though it gives you no provider to complain about either. Running a plan yourself sets out what that involves.
Frequently asked questions
Do my creditors have to agree to me changing provider?
No. They were never parties to the plan, so there is nothing for them to approve, and they are simply written to by whoever is running the arrangement.
Is there a notice period?
Not one fixed by law, because a debt management plan is not a statutory scheme. Your contract may set one, and the rules require it to set out any cancellation terms.
Can I be charged for leaving?
That depends on your contract. The rules prohibit charges that are unreasonable or disproportionate, so ask for the figure in writing and query it if it looks high.
Will switching restart the six years on my credit file?
No. The markers belong to the individual accounts and run from their own dates, and the plan itself is not recorded anywhere on the file.
How do I know a new provider is genuine?
Search the Financial Services Register and read the permissions rather than just the name. The regulator publishes limitations that can exclude running a debt management plan altogether.
Are the free providers really free?
Yes, to you. StepChange is paid a share of what creditors receive, at an average of 10.33 per cent in 2024, and Christians Against Poverty is funded by donations.
Can I move to a free provider if I am in arrears with the fee-charging one?
Nothing prevents it. Ask the old provider for a statement of what it has taken and what it is still holding before you close the arrangement.
Should I switch or move to a statutory solution instead?
That depends on whether the problem is the provider or the plan. A plan cannot freeze interest or reach a wage arrestment, and a money adviser can tell you free of charge whether a statutory route fits better.
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Written as general information about Scottish debt law rather than regulated financial or legal advice, and your own circumstances may change the answer. Free, impartial help is available from Citizens Advice Scotland, StepChange, National Debtline and Advice Direct Scotland.