PERG 17.2 The basic elements of debt counselling

Q2.1 What is the basic definition of debt counselling?

It involves the following elements:

(1) It is advice given to:

(a) a borrower about the liquidation of a debt due under a credit agreement; or

(b) a hirer about the liquidation of a debt due under a consumer hire agreement;

(see PERG 17.3 for more about what the advice must be about).

(2) The advice must relate to a particular debt and debtor (see PERG 17.4).

(3) It covers the giving of advice. It does not cover just giving mere information. This is explained in PERG 17.5.

(4) If an exclusion applies, the activity is not a regulated activity (see PERG 17.6).

Q2.2 Can you give some examples of what is and is not debt counselling?

Yes. There are examples in PERG 17.7.

Q2.3 What other factors are relevant to whether authorisation is needed?

(1) Whether the activity is carried on by way of business (see PERG 2.3).

(2) Whether an exemption is available (see PERG 2.11).

(3) Whether the person can carry on the activity without authorisation (see PERG 2.10.12 G to PERG 2.10.16 G).