The attitude of banks to the individual voluntary arrangement (IVA) process has been attacked by leading industry figures after falling numbers of IVAs were recorded in the second quarter of 2007, according to reports.
According to R3 vice president Nick O`Reilly, banks are advising debtors not to take out IVAs and are being denied the means to consolidate their debt problems.
He told Accountancy Age: "The people who will suffer as a result are the debtors who, in many cases, will be denied the most suitable technique for managing their debt which could help them work their way out of debt."
Take-up of IVAs fell in the three months to June by more than 15 per cent while bankruptcies decreased by 2.9 per cent, figures released by the Insolvency Service earlier this month show.
The IVA consists of a formal agreement between the debtor and creditors to make reduced payments over a longer period of time.
